[News] A Short History of BP
Anti-Imperialist News
news at freedomarchives.org
Wed Jun 16 12:10:39 EDT 2010
http://www.counterpunch.org/kamiar06162010.html
June 16, 2010
Beyond Petroleum, Beyond Pollution, Beyond Politics
A Short History of BP
By M. KAMIAR
British Petroleum is the UKs largest
corporation. It is among the largest
private-sector energy corporations in the world.
It is a vertically integrated cartel that
operates oil and natural-gas exploration,
marketing, and distribution all over the globe.
BP, however, goes beyond petroleum, indeed,
beyond business. The mess we have today in the
Gulf of Mexico is not the first time BP has
committed crimes against the environment and
against people. This is a proverbial drop in the
bucket for BP. This outfit has been cheating humanity since its inception.
Many people do not know that BP was born, named
after, and committed many crimes against the
people of Iran. For nearly 80 years, it seized
the wealth of that nation, interfered in its
politics, and destroyed its future.
The history of crude-oil exploration and
production in the Middle East began with William
Knox DArcy (1849-1917), a British subject living
in Australia who became very rich very
quicklytwice. DArcy, a lawyer, invested in gold
mines in Rockhampton, Queensland. After becoming
a millionaire by the end of 19th century, he and
his family returned to England.
In 1901, DArcy obtained a concession from the
government of Iran to drill for mineral
resources, with the exception of the five
northern provinces the Russians wanted. This
concession, called the Green Document, was
written on a page of green paper signed by the
Shahanshah, king of kings, of Iran. DArcy was to
pay the government of Iran £20,000 in cash and
£20,000 in stock in the proposed operation, plus
a royalty of 16% of net profits from all
enterprises formed under the agreement.
DArcy founded the First Exploration Company in
1903. He never set foot on the land that made him
a wealthy man. DArcy conducted business through
representatives and later through the UK
government. He hired G. B. Reynolds, an
experienced geologist-engineer, to oversee the
drilling. Reynolds had worked in India and been drilling in Sumatra.
Reynolds had visited Baghdad frequently and had
paid close attention to local legends, especially
the stories about Zoroastrian temples built on
eternal fire and tar pits in southwestern Iran.
He hired scouts from local nomadic tribes. These
were akin to Native Americans guiding Ponce de Leon to the Fountain of Youth.
He had two areas in mind. The very first attempt
at drilling in western Iran, in Qaser Shirin,
near the border with the Ottoman Empire, was
disappointing. A third well was drilled near
Masjid Sulaiman, 80 miles northeast of Ahvaz, the
capital of Khuzestan province. There was no oil here either.
DArcy had spent more than £225,000 to no avail
and was ready to sell his precious Green
Document. He mortgaged his remaining gold
holdings but was still running out of money.
DArcy telegraphed Reynolds and told him to close down the operation.
But Reynolds was sure he would find oil. He
telegraphed back and asked for written
confirmation to be sent by mail. While waiting
for the mail, which normally took two weeks, he
and his scouts followed their noses day and
night, searching for that rotten-egg smell.
Reynolds ordered drilling for a fourth well where
he had found traces from a natural seepage in the same vicinity as the third.
This one was a gusher. The crude shot 50 feet
over the derrick from a well that was 1,180 feet
deep. On May 26, 1908, the most significant
chapter in the history of the Middle Eastif not the whole of mankindopened.
By its 100th anniversary, this well had produced
more than one billion barrels of light crude oil.
Reynolds had struck one of the worlds richest
oil fields on the edge of the Persian Gulf basin.
With 314 wells, the Masjid Sulaiman field was
still producing about 7,000 barrels of oil per
day in the early 1980s. And this was only the
first of many productive Persian Gulf reservoirs.
In 1909, DArcy formed the Anglo-Persian Oil
Company (APOC). Britains First Lord of the
Admiralty, Winston Churchill, had been following
the progress of the burgeoning petroleum industry
because he was thinking of converting the British
navys ships from coal to oil, which he
implemented in 1911. In order to protect its
supplies of this now-crucial military resource,
the British government became part owner of APOC
in 1914, acquiring 50 percent of the voting
stock, reimbursing all of DArcys expenditures,
and granting him £900,000 worth of shares. DArcy
remained a director until his death in 2000. In
1923, the company secretly paid £5,000 to
Churchill to lobby the UK government to grant
APOC a monopoly on Iranian oil resources (Myers 2009).
The rush was on. Western oil companies eventually
attained total control over the middle-eastern
oil industry. These companies often became de
facto rulers of these semi-colonial territories.
All aspects of exploration, production, refining,
and marketing were controlled by these
multinational corporations. The owners not only
discouraged but prevented native populations from
obtaining the skills and education to manage
their own resources, and workers were treated no better than slaves.
In 1935, the Iranian government sent a memorandum
to all foreign embassies in Tehran to address the
country by its correct name: Irannot Persia.
Persia, or Pars, is only one of 30 provinces in
Iran; Greek historians mistakenly assumed that
all people in Iran were Persians, and the British
and others kept repeating this mistake (Kamiar
2007). APOC was forced to change its name to Anglo-Iranian Oil Company (AIOC).
Oil concessions generally covered very large
areas and were for long durations. They paid a
small, fixed, non-negotiable royalty. Until 1953,
AIOC was paying Iran a 16% royalty. The
government of Iran was not even allowed to check AIOCs records.
More importantly, these oil imperialists were
supported by the full military might of their
respective governments. Irans shah, who was
installed by the Allies in 1941, headed a corrupt
dictatorship. There is no telling what or how
much he stole from his people. With the help of
these corrupt shahs, first backed by the British
then by the US, AIOC appropriated the lions share of Irans wealth.
By the post-WWII era and the beginning of
decolonization, educated people in Iran realized
the country was in effect occupied and controlled
by AIOC. Theyd had enough. Coinciding with the
growth of a new nationalist fervor in the region,
the shah was forced aside, remaining primarily as
a figurehead, and a new prime minister, Mohammad
Mossadeq, was elected in 1951. Mossadeq, with the
approval of Majlis (the Iranian parliament),
nationalized Irans oil industry. The British
government contested the nationalization at the
International Court of Law, but its complaint was dismissed.
The British had, in effect, been kicked out of Iran.
AIOC responded with a boycott of Iranian oil, but
that was not enough to bring the country to its
knees. The British then approached Washington for
help. Nothing much developed during the remainder
of the Truman presidency, but the incoming
president, Dwight D. Eisenhower, was a very close
friend and ally of Churchills and did not ignore
his comrades pleas for assistance.
In 1953, the year Eisenhower took office, the CIA
went into action, in partnership with the
British. Eisenhower approved the plan, called
Operation Ajax, of instigating a counter-coup
designed to return the shah to total power. The
director of the operation was Theodore
Roosevelts grandson, Kermit Roosevelt, who
headed the CIAs Middle East division. The CIA
paid out $1 million to hire demonstratorsmostly
gang members, prostitutes, drug addicts, and
thugs (Gelvin, 2005, p. 279; Fayazmanesh, 2003,
p.4). This same tactic had been used successfully
in Italy in 1948 to prevent the communists from
winning the elections. Operation Ajax, mostly
planned by Donald N. Wilbur, an architecture
expert, was also supported by few ayatollahs,
powerful landlords, and big merchants. The riots
and chaos that ensued did the trick, and Mossadeq
was forced to resign. (See Alexander Cockburn's
<http://www.counterpunch.org/cockburn06112010.html>The Crude Truth.)
When the shah triumphantly returned to Tehran on
August 19, he personally expressed his gratitude
to his savior, Kermit Roosevelt, for putting him
back on his Peacock Throne. Upon returning to the
US, Roosevelt accepted a job with Gulf Oil. He
remained in demand as a consultant and liaison
between American oil companies and Middle Eastern governments.
The shahs return opened a reign of terror,
funded by the US, in Iran. Mossadeq was found
guilty of treason, spent three years in solitary
confinement, and was put under house arrest until
his death in 1967. The majority of his
supporters, however, were turned over to firing
squads. Mossadeqs foreign minister, Hossein
Fatemi, was taken from a hospital to be executed.
In return for US help, AIOC agreed to share its
Iranian concession with US oil companies.
American victory in Iran resulted a newly formed
oil consortium, expansion of the right of
extraterritoriality (meaning US and UK nationals
could not be tried in Iranian courts), and the
establishment of SAVAK, the shahs secret police.
SAVAK was created in 1957 with CIA assistance and
US tax dollars. Its primary mission was to
eliminate threats to the shah. Its tactics
included censorship, disappearances of dissidents, torture, and execution.
The shah showed his gratitude to US
foreign-policy makers. During the wars of 1967
and 1973 between Israel and its Arab neighbors,
the shah provided cheap fuel for the Israeli war
machine even as Arab members of OPEC decreased
oil production and created an oil embargo
directed at the western nations, causing oil
prices to quadruple in two months. By 1975, as
the worlds second-largest oil producer (after
Saudi Arabia), Iran was earning nearly $20
million per hour. Much of this money went to the
US as Iran became the largest purchaser of American weapons.
In 1954, AIOC changed its name to British
Petroleum. In 1959, BP expanded beyond the Middle
East to Alaska, and in 1965 it was the first
company to strike oil in the North Sea. Today,
the oil company that began in Iran has gone
global. It has oil wells and gas stations on all continents.
At $1 million, the counter-coup in Iran seemed
like a bargain for the US. But was it? Drawing a
straight line from the overthrow of Mossadeqs
government in 1953 to the Iranian revolution of
1979and perhaps to the events of September 11,
2001we begin to see Operation Ajaxs ultimate
cost in terms of money and lives. From 1953 to
1979, Iran was a BP prison, polluted and poor,
run with an iron fist by the company and its puppet, the shah.
Now it is drilling offshore near the US in the
Gulf of Mexico. Many Americans in the region are
beginning to feel the pain and outrage Iranians
endured for 70 yearsgetting a small taste of how BP goes Beyond Politics.
Dr. M. Kamiar is a professor of geography at
Florida State College. With Professor Stanley D.
Brunn, he is editing Native World Geography. Each
chapter on a region in this book is going to be
written by a geographer with a doctoral degree
from that region. He can be reached at
<mailto:mkamiar at fscj.edu>mkamiar at fscj.edu.
Sources cited:
CIA. The World Factbook.
https://www.cia.gov/library/publications/the-world-factbook/geos/ir.html.
Fayazmanesh, S. In Memory of August 19, 1953:
What Kermit Roosevelt Didnt Say. www.counterpuch.org, August 18, 2003.
Gelvin, L. G. The Modern Middle East: A History.
Oxford: Oxford University Press, 2005.
Kamiar, M. Country Name Calling: The Case of
Iran vs. Persia. The American Geographical
Societys Focus on Geography, Vol. 49, No. 4, Spring 2007, pp. 1-11.
Myers, K. The Greatest 20th Century Beneficiary
of Popular Mythology has been the Cad
Churchill. Independence, Thursday September 03,
2009.
<http://www.independent.ie/opinion/%20columnists/kevin-myers/the-greatest-20th-century-beneficiary-of-popular-mythology-has-been-the-cad-churchill-1876680.html>http://www.independent.ie/opinion/
columnists/kevin-myers/the-greatest-20th-century-beneficiary-of-popular-mythology-has-been-the-cad-churchill-1876680.html.
Pollack, K. M. The Persian Puzzle: The Conflict
Between Iran and America. New York: Random House, 2004.
Freedom Archives
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