Page 143 - Historical Summaries (Persian Gulf - Vol II) 1907-1953

130
39. Immediately after the termination of the International Marine Oil
Company s concession, the Shell Overseas Exploration Company applied to the
Ruler for an off-shore concession. A Memorandum of Agreement was signed in
May 1952 but the execution of the main Agreement was deferred pending the
conclusion of a fifty-fifty profit-sharing agreement between Petroleum Development
(Qatar), Ltd., and the Ruler (paragraph 34 above). The main agreement^*) was
eventually signed on November 29, 1952. It was for 75 years and covered 44 (i) all
the sea-bed and subsoil underlying the spring lide of the waters of the Persian
Gulf which fall within the jurisdiction of the Shaikh and which lie beyond
territorial waters, and (ii) any and all islands, islets, shoals and bars which may
after the 6th day of August, 1952, rise from, accumulate, build up or otherwise
be created by nature or by the company above spring tide of the waters within
the area as defined in (i) above.” Provision was made for a signature payment
of £231,976 and an annual payment of £75,415 until the commencement of regular
exports of oil, and after that of £37,707. All payments other than the signature
payment are be made in sterling. There is an obligation to drill within two years
but the period may be extended by successive periods of one year each on payment
of £37,707 for each extension. The arrangements regarding the payment of royalty
and the sharing of profits are on the lines of those provided for in Petroleum
Development (Qatar), Limited’s profit-sharing agreement of 1952 (paragraph 34
above). Three letters are attached to the agreement. The first(73) of these covers a
number of miscellaneous matters, mostly of an administrative nature, and includes
an undertaking by the company to discuss with the Ruler the measures to be
taken if it is compelled to suspend its operations by means of force majeure, the
second(74) relates to payments to be made under the agreements and the thirdf4)
contains a promise by the company to bring its personnel and equipment from
Bahrain to Dohah by specified dates.
40. A Political Agreement^0) between Her Majesty’s Government and the
company was signed on December 15, 1952. Besides the usual provisions, including
one about navigation, fishing and pearling as in the Superior Oil Company’s
Political Agreement (paragraph 36 above), it contained an undertaking by the
Company not to dispute with the Ruler or Her Majesty’s Government about the
boundaries of the sea-bed area and until they were fixed to refrain from any
operations permanently affecting the sea-bed in any area which the Ruler or Her
Majesty’s Government might define. The company had already agreed to refrain
from such operations in the waters around the Dibal and Jaradah shoals,(”) and
before the signing of the agreement the Foreign Office issued detailed instructions
to the company about the area in which they might operate and defined certain
limitsC*) (Appendix C). The Political Agreement was communicated to the Ruler
but the usual exchange of letters regarding it had not been effected by the end of
1953 owing to the Ruler’s request for clarification of certain points in the
Agreement.
41. The company is constructing residential quarters on the north side of
Dohah and an industrial area on the south side of the town. In this it is pursuing
a different policy from the other oil companies in the Gulf who have located their
camps at a distance from the main centres of population.
42. At the end of 1953 a company called the Shell Company of Qatar,
Limited, was incorporated in the United Kingdom to operate the concession, which
it was proposed to assign to it.

V.—Relations with Other States
(a) The Gulf States
43. In 1937 Abdullah attacked some Na’im tribesmen from Bahrain in the
vicinity of Zubarah and expelled them. Since then relations between Qatar and
Bahrain have been strained. The Ruler of Bahrain claims certain rights in Zubarah
(”) No. 6 III. O.A.C.
(”) No. 6 (a) III, O.A.C.
(r4) No. 6 (b) III, O.A.C.
(T#) No. 6 (c) III. O.A.C.
(r#) No. 7 III. O.A.C.
W) Shell to F.O. Letter of October 17, 1952 (EA 15313/21 of 1952).
(T‘) F.O. to the Shell Petroleum Company Ltd. EA 15313/15 of September 2,