The revision of Iraq's oil concession, 1949–52

Abstract

overthrow of the Iranian government, and the great increase of the shah's power in Iran, had fateful consequences for the entire region. Precisely because of their significance, these events have overshadowed the important and contemporaneous negotiations between the Iraqi government and the British-managed and largely British-owned Iraq Petroleum Company for successive revisions of the company's concession. To shed light on these major events in the history of the old regime in Iraq will be the purpose of this article. As a result of a series of agreements concluded in the 1920s and 1930s, during the 1940s the Iraq Petroleum Company and its two wholly owned subsidiaries, the Mosul Petroleum Company and the Basra Petroleum Company, held concessions to develop and export virtually all of the oil in Iraq. The only part of the country for which they did not hold concessions was a small area near Khanaqin along the border with Iran known as the transferred territories for which the concession was held by the AngloIranian Oil Company. Except for the 5 per cent which was held by a wealthy Armenian investor named C.S. Gulbenkian, the IPC was owned in equal amounts of 233/4 per cent by four different groups representing four separate nations acting together as a conglomerate. These groups were the AIOC (British), Royal Dutch-Shell (British and Dutch), Compagnie Franqaise des Petroles (French), and the Near East Development Corporation (an American consortium held in equal shares by Standard Oil of New Jersey and Socony-Vacuum). However, at the insistence of the British government, which held a League of Nations mandate for Iraq when the original seventy-five-year concession was granted in 1925, the IPC was registered in Britain and always had a British chairman. These provisions, combined with the substantial degree of British ownership, enabled the British government to exert considerable influence over the company.2