834.6363/10–1744
Memorandum of Conversation, by Mr. Rex Townsend of the Petroleum Division
Mr. Rubel, Vice President of the Union Oil Company telephoned me on Tuesday, October 17, 1944 from Los Angeles, stating that he had returned from Asunción on October 14th and that in their opinion, they had made a satisfactory deal for a concession with the Paraguayan [Page 1479] Government. He met Leslie Webb50 when he was down there and gave him all the information.
Mr. Rubel stated that the Embassy was sending the original copies of the papers for transmittal. He said that he was having copies made both in the Spanish and English text to transmit to the Department.
Mr. Rubel further stated that he had received splendid assistance from the American Embassy at Asunción which contributed to the successful conclusion of the negotiations. He stated further that he thought they made a pretty good deal, having a 10-year exploration period with an additional eight years for further investigation, and a total of 35 years of exploitation. There is a sliding scale of royalties beginning with 12% and increasing from that amount based on volume of production. The importation of equipment will be entirely tax free.
Mr. Rubel stated that there are still a number of legal details to be cleared up, particularly the question as to whether the operation is to be carried on in the name of the Union Oil Company or in the name of a domiciled Paraguayan Company.
The closing of the deal was confirmed by Presidential decree and subsequently ratified by the Conselho with the President’s signature which in Mr. Rubel’s opinion has the same effect as law.
He stated that he would be in Washington next week and would come in to tell us about the situation.
- Petroleum expert of the Petroleum Division. He had conducted surveys and made studies of the problems of the Petroleum Pool.↩