San Remo Oil Agreement

The San Remo Oil Agreement was an agreement between Britain and France signed at the San Remo conference on 24 April 1920. As a result of the agreement, the French Compagnie Française de Petroles (CFP) acquired the 25% share held by Deutsche Bank in the Turkish Petroleum Company (TPC). The other shareholders were (same as in 1914): the Anglo-Persian Oil Company (APOC), in which the British government held a controlling interest, with 47.5%, the Anglo Saxon Petroleum Co (wholly owned subsidiary of Royal Dutch-Shell), with 22.5% and the remaining 5% belonged to Calouste Gulbenkian. This however is inferred from context and the eventual success enjoyed by the TPC in subsequent negotiations. The text of the agreement says nothing about Germany (early drafts did mention it), but grants to France the right to buy a 25% share in any future concession that may be obtained in Mesopotamia by either the British government or a private company. It also says nothing about the composition of the remaining 75% of that entity, except that 20% should be made available out of both the French and British shares for acquisition by Iraqi nationals, a stipulation that was eventually not honored in the dealings with the Iraq government.

The Turkish Petroleum Company was still a paper-only company in 1920. The composition of the TPC changed again in 1928. Only in 1925 did TPC get a concession for development from Iraq. In 1927 the company found oil in Iraq and was renamed the Iraq Petroleum Company in 1929. In 1934 production from the Kirkuk field started to reach world markets. The Iraq Petroleum Company and its affiliates then dominated the important Iraq petroleum industry for almost four decades, until the company was nationalized in 1972.