Page 361 - The Arabian Gulf States_Neat

SUBMARINE BOUNDARIES 297 :
to the dispute over ‘pasture rights’ which later determined the settle­
ment involved in the creation of the Neutral Zone.1
Aminoil concession over the Islands: On 22 September 1949 the Ruler
of Kuwait granted a subsidiary of Aminoil of the Neutral Zone, known
as the American Oil Company of California, a concession covering
‘the islands of Kubr, Qaru and Umm al-Maradim and their territorial
waters’. The concession gave the company exclusive rights of ex­
ploration, production and ownership of all petroleum produced. The
concession defined the territorial sea of the islands as ‘three nautical
miles from low-water mark' (Art. 1).
However, despite the above concession, no work or drilling had
taken place until 1962, when a seismic survey was carried out by
Aminoil. In his recently published book, the late E. Brown describes
the Aminoil concession as being‘based on ludicrously cheap financial
terms'. He also says that there ‘was no down payment upon signature
as in the ease' of Aminoil’s concession applying to the Neutral Zone.-
Although Saudi Arabia had made no formal protest in the past against
the above concession, there are, nevertheless, indications that she
vigorously disputes the Kuwaiti claim to exclusive sovereignty over
the two islands of Qaru and Umm al-Maradim which she regards as i
being part of the Neutral Zone offshore areas. According to E. Brown,
there exists ‘a separate confidential letter agreement’ between Saudi
Arabia and Arabian (Japanese) Oil Company which specifically refers
to the two islands as falling within the offshore ‘concession area’
granted to the company by Saudi Arabia in respect of the latter’s
undivided half interest of the Neutral Zone. But, in the words of
the author, this letter agreement states further that
since the two Governments of Saudi Arabia and Kuwait are contemplating
discussions as to their territorial rights over these islands, they would not I
be mentioned in the concession agreement. However, if at a future time, it
was determined that these islands belonged cither to the Kingdom of Saudi
Arabia or the Neutral Zone, they would become subject to the terms and ■
conditions of the Japanese concession agreement.3
It is noteworthy that Kuwait has recently signed a new concession
agreement with Aminoil. The new concession involves ‘extensive
revisions of the terms of the 1949 agreement’ under which Aminoil
obtained its original concession over the three islands. The purpose
of the new agreement was to bring the financial terms of the original
agreement into line with those of Aminoil’s agreement pertaining to
the Neutral Zone onshore.4 Furthermore, recent developments of
1 For background information on this subject, see MEES, No. II, Suppl.,
1 January 1963; ibid., No. 15, 14 February 1964. And see Brown, E. H., The
Saudi Arabia-Kuwait Neutral Zone (1963), p. 107.
2 Brown, op. cit., p. 107. 3 Ibid., p. 108.
4 MEES, No. 6, 13 September 1963; ibid., No. 15, 14 February 1964.

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