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United States Department of State / Foreign relations of the United States diplomatic papers, 1937. The British Commonwealth, Europe, Near East and Africa

Afghanistan,   pp. 597-614 PDF (6.5 MB)

Page 601

  16. The Government has the right to inspect the technical activity
of the Company and to appoint foreign specialists for the purpose.
(Note: The A. I. 0. C. contract does not use the word "foreign".)
  17. The Government may appoint a "Delegate" who will represent
the Afghan Government at the Company's headquarters.
  18. Afghan nationals shall be used to the extent possible. If for-
eigners are needed they must be American. (The A. I. 0. C. contract
does not contain such a stipulation.)  After the beginning of expor-
tation the Company shall furnish $50,000 annually for the technical
education of Afghan students in the United States. (VD 3 does not
perceive any visa difficulty in this connection.)
  18. [sic] The concession is for seventy-five years. The Company
may renounce it upon six months notice during the first ten years and
thereafter upon two years notice. At the conclusion of the concession
all property of the Company reverts to the Afghan Government.
  19. All differences shall be subject to arbitration.
  20. Any transfer of the concession shall be subject to ratification
by the Afghan Government.
  21. The concession may not be cancelled or abrogated by the Gov-
  22. The concession was signed in English subject to translation into
Persian. The English text shall always prevail.
  Considering that the A. I. 0. C. concession, with which this one is
approximately identical, was considered to be severe, the Inland agree-
ment would appear to be doubly hard in view of the little that is known
regarding the oil resources of Afghanistan and the great distance
over which pipe lines have to be built. There is a certain compensa-
tion, however, in the fact that minimum payments are much lower in
the case of the Inland agreement, i. e., 2750,000 for royalties and
2300,000 for tax exemption in the case of A. I. 0. C. as compared to
2250,000 (later to be raised to 2450,000) for royalties and no mini-
mum specified for tax exemption in the case of Inland.
  The Vice Con8ue at Karachi (Rigg8) to the Secretary of State
No. 662                                KARACHI, March 12, 1937.
                                            [Received March 29.]
  SIR: I have the honor to refer to Consul Groeninger's Strictly Con-
fidential despatch No. 573 of February 18, 1936,4 bearing on the acquisi-
tion of certain sections of land in Afghanistan, said by geologists to
cover extensive and valuable oil deposits.
  In the above connection I have to inform the Department that Mr.
Frederick G. Clapp, Head Geologist of the Inland Exploration Com-
'Visa Division.
4Not printed.

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