Page 167 - Historical Summaries (Persian Gulf - Vol II) 1907-1953

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except Fujairah for which they hold an exploration option only. They have
surveyed most of the country within 50 miles of the coast without meeting with any
serious hindrance and have drilled in the Abu Dhabi and Dubai Shaikhdoms. 3
71. Petroleum Concessions Ltd. obtained their first concession from Dubai
in 1937. At that time the Standard Oil Company of California was also showing an
interest in the Trucial States. The Political Resident was instructed to inform the
other Rulers in case of necessity that His Majesty’s Government did not wish to
have more than one company operating on the Trucial Coast that they were
therefore prepared to approve agreements with Petroleum Concessions Ltd. but
were not prepared to permit negotiations with any other company.*4")
72. In 1949 all the Rulers except Kalba issued declarations claiming
jurisdiction over the sea-bed and subsoil contiguous to their territorial waters.*43)
Fujairah did not then exist as a separate State and its Ruler has not issued a similar
declaration since its independence was recognised. Kalba has since been
reincorporated with Sharjah and the point whether the declaration issued by the
Ruler of Sharjah in 1949 now applied to its sea-bed has not been considered.
The point is not of importance as in the Gulf of Oman the sea-bed shelves steeply
and it is doubtful whether an oil company could operate in it beyond the limits
of territorial waters. At present Petroleum Development (Trucial Coast) Ltd. hold
concessions for the sea-bed of all the States which have issued declarations except
Abu Dhabi, the sea-bed concession for which is held by the D’Arcy Exploration
Company. The Dubai concession, however, is not in their name but in that of
their General Manager.
73. All the land concessions held by Petroleum Development Trucial Coast
Ltd. are in much the same form. They provide for down and annual payments
which vary and a uniform rate of royalty on oil when produced of Rs. 31- per ton
plus as. 4 for certain customs facilities, and are valid for 75 years. As all the
Rulers are under an obligation not to grant a concession for oil except to a person
appointed by Her Majesty’s Government*4') the concessions were all formally
approved by Her Majesty’s Government before they came into force. They are
accompanied by Political Agreements between Her Majesty’s Government and the
company. The contents of these were communicated to the Rulers of Dubai,
Sharjah and Ajman who agreed in writing to accept the principles involved. They
have not been communicated to the other Rulers. The Rulers mentioned above
have also agreed to be guided by the advice of Her Majesty’s Government in the
exercising of the right of termination which they enjoy under their concessions,
and not to enter into negotiations with a Bank for the opening of a branch in their
States, a matter which is referred to in the concessions, without first obtaining Her
Majesty’s Government’s approval. The latter undertaking has also been given by
the Rulers of Umm al Qaiwain and Ras al Khaimah. Petroleum Development
(Trucial Coast) Ltd. maintain a Local Representative at Dubai, who is responsible
under the Political Agreements for dealings with the Political Agent and through
him with the Rulers in respect of all the concessions which they are operating.
74. The sea-bed concessions vary in form. There are entirely separate
concessions in respect of Abu Dhabi and Dubai. At Ajman one concession covers
both the land and the sea-bed and at Umm al Qaiwain, Ras al Khaimah and
Sharjah additions have been made to the original land concessions so as to ex^ei}.
their scope to the sea-bed. The Political Agreements in respect of the Abu Dhabi
sea-bed concessions and the Dubai and Ajman concessions have been
communicated to the Rulers and acknowledged by them. They contain clauses
under which the companies concerned agree to accept and sea-bed boundaries
eventually delimited and meanwhile not to drill or carry out operations likely
permanently to affect the sea-bed outside limits to be fixed by Her Majesty s
Government, and also to avoid interference with navigation, fishing and pearling.
Limits have been defined for operations in the Abu Dhabi sea-bed but no
elsewhere.
75. Until a very short time before the close of the period under review no
had been found in any of the States. All the concessions therefore remain in
form in which they were originally negotiated and have not been brought i
line with the “ fifty-fifty ” agreements now in force in the oil-producing Shaikh
(«) I.O. toF.O. P.Z. 3833/37 of June 18. 1937 (E 3342/12/91 of 1937).
(ss) No. 9 VI. T.C.
(“) No. 10 IV. T.C.