812.6363/9–1144
The Ambassador in Mexico (Messersmith) to the Secretary of State
[Extracts]
No. 20,043
México, D.F., September 11,
1944.
Sir: I have the honor to inform the Department
that the Minister of Foreign Relations, Dr. Padilla, has handed me a
Memorandum, dated September 6, 1944, of which a copy in the original
Spanish is transmitted herewith (Enclosure No. 177), as well as a
translation thereof (Enclosure No. 2). In handing this memorandum to me
the Minister referred to the conversation which he had had with me on
his return from Washington some time since. He said that during his stay
in Washington, President Roosevelt had indicated that our Government
would be prepared to give to the Mexican Government a loan for the
development of Mexican oil resources. The Minister recalled to me that
on his return he had brought this conversation with President Roosevelt
and Secretary of Interior, Ickes, to my attention and he recalled to me
that before leaving Washington he had fully informed Secretary Hull of
these conversations.
. . . . . . . . . . . . . .
I have not had any instructions from the Department with regard to this
matter since the return of Dr. Padilla from Washington and I have,
therefore, been under the necessity of refraining from carrying on any
conversations with regard to major oil policy with the Mexican
Government in the meantime. It was my understanding from the character
of the conversations which had taken place in Washington during Dr.
Padilla’s stay, and with particular reference to a loan, that the
probabilities were that the initiative remained with us.
I was, therefore, somewhat surprised when Dr. Padilla handed this
memorandum to me, which is a definite indication that the Mexican
Government wishes to discuss the question of a loan.
I consider this matter as of such fundamental importance, not only so far
as major oil policy is concerned, but so far as our relations with
Mexico are concerned, that it will be necessary for me to discuss the
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matter with you and with
the President before I can be in a position to enter into any
conversations with Dr. Padilla and the Mexican Government on this matter
which involves so grave and important a decision of policy. I,
therefore, informed Dr. Padilla this morning that I was transmitting a
copy of the memorandum in question to the Department but that in view of
the importance of the matter and being without any instructions, I could
not discuss it but that I would discuss it with you during my planned
trip to the United States on a holiday. The Minister said that he
thoroughly understood and that he would understand not hearing from me
about this matter until my return.
As you will recall, I am leaving here on September 25 for a brief holiday
trip to the United States and it is my plan to be back here during the
first days of November. I shall be in Washington October 2, 3 and 4,
during which time I hope to have the opportunity of discussing this
important matter with you and if you think desirable, with the
President.
Dr. Padilla when he handed me this memorandum said that he had not made
any reference in the memorandum to the question of setting up a certain
part of Mexico’s oil reserves to be used only in time of war. He said
that the Mexican Government was favorably disposed to consider this
matter but that he did not deem it desirable to include it in the
memorandum. I could, however, say to you and to President Roosevelt,
that the Mexican Government was prepared to favorably consider the idea
of setting aside a part of her petroleum reserves for specific use in
time of war and would also be prepared to enter into detailed
conversations in this respect.
In view of the fact that I will have the opportunity of discussing this
matter with you in the early days of October, I am not making any
comment on this proposal of the Mexican Government in this despatch.
Respectfully yours,
[Enclosure—Translation]
The Mexican Foreign
Office to the American
Embassy
During the course of an interview which Licenciado Ezequiel Padilla,
the Minister of Foreign Relations of the Government of Mexico, had
with his Excellency President Franklin Roosevelt, during the recent
visit which the former made to the City of Washington, there was
clearly brought out the timeliness and the advisability that Mexico
explore her petroleum wealth and plan the means of exploiting it in
the most suitable way for Mexican interests and for the defense of
the Western Hemisphere.
It was agreed that petroleum is a combustible which must be
considered
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as one of the
products of greatest strategic value for the defense of the
Americas.
For this reason, his Excellency President Roosevelt and the Minister
of Foreign Relations of Mexico, the latter in pursuance of
instructions which he had received from President Manuel Avila
Camacho, came to the conclusion that there must be secured a full
collaboration of North American banking institutions to carry out
this exploration and exploitation on the conditions which are set
forth in summary form below.
His Excellency President Roosevelt suggested to Licenciado Padilla
the advisability of speaking with his Excellency Harold Ickes, the
Secretary of the Interior. The interview was held with the knowledge
of his Excellency Cordell Hull, the Secretary of State, who was kept
informed of these conversations in all their details.
In order that the Department of State of the Government of the United
States of America may officially consider the conditions under which
the Government of Mexico will accept the collaboration of North
American capital in the development of the petroleum industry, the
Minister of Foreign Relations permits himself to present the
following proposals:
- First—The program for the operations intended to develop
the Mexican petroleum industry will continue to be carried
out, as up to the present time, by the Government of Mexico
through the proper agencies; the Government of Mexico will
also determine the rate at which such exploration and
development should be carried forward.
- Second—Upon request of the Government of Mexico, a North
American banking institution, which might be the
Export-Import Bank, will advance—in installments—to
Petróleos Mexicanos a considerable long term cash loan when
the resources of the Government of Mexico are
insufficient.
- Third—This loan will be interest bearing, which would be
moderate and regulated in the line of the object for which
the loan is intended.
- Fourth—After meeting domestic requirements of Mexico,
Petróleos Mexicanos will agree to cover the amount of the
loan, with the available surpluses of crude petroleum, and
preferentially in derivatives of petroleum in the proportion
which will be agreed upon. In due course there would be
determined the form of estimating the domestic requirements
of the country with the objective of defining correlatively
the surpluses which can be earmarked for exportation. In the
same way would be fixed the norms for the determination of
the price of the products which are to be delivered.
- Fifth—The interest would be paid on their respective dates
of falling due.
- Sixth—Petróleos Mexicanos, in accord with the banking
institution under reference, if the banking institution so
desires, will engage the
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services of technicians and
specialists in the different branches of petroleum
exploration and exploitation. Petróleos Mexicanos will study
with pleasure any suggestion in this sense which the
above-mentioned banking institution desires to make.
- Seventh—In connection with the representations which
Petróleos Mexicanos makes to the proper North American
authorities to acquire machinery and the equipment necessary
for carrying out the project herein described in general
terms, it will gratefully receive any co-operation which the
banking institution may extend to it in this sense.
- Eighth—Should the points which this memorandum contains be
approved, as a base of discussions by the Government of the
United States, conversations can be held in this capital
with the object of duly implementing it.
Mexico, September 6,
1944.
