Evening star., 1935-08-31
Details Of Ethiopian Deal
Delaware Company Gets Exclusive Rights to Prospect
for Petroleum and Other Substances.
By the Associated Press.

explore, prospect, drill and TO extract
and render suitable for trade petrol
cum, naphtha, natural gases, ozocerite
and all other bituminous substances,
also iodine from salt water Of any
wells drilled and the right to dispose
of these products with their deriva-
tives.
At the expiration of IS years all
rights will terminate and all the COM
pany's land and buildings, as well as
wharves. roads. pipe lines, railway
machinery, plants and fixtures, be-
come the property Of the government.
Surveys to Start in One Year.
The company one year after date
shall begin geological survey in the
defined areas. The company's serv-
ants and agents shall furnish power
to any part Of the area free Of
charge.
Within five years the company must
start drilling. Thereafter drilling op-
erations will be continued by three
rigs until sufncient area has been
tested and petroleum discovered in
sufficient quantities to meet Ethiopian
requirements and 2,500,000 tons an
nually to meet the requirements of
the company's export trade.
AS soon as a pipeline outlet Is
commercially justiflable in the judg-
ment of the company, and always
providing there is taken for q stand
ard of measurement an oil of viscosity
and flowing properties from the Baba
Gurgur structure in Irak, the COM
pany shall start the construction of
pipeline and complete 1t as rapidly
as possible, provided that access to
suitable port for loading tank ves-
sels Is made available by the Ethio-
plan government or the particular
government which controls the port.
Pipeline Must Come In Four Years.
If the order for q pipeline Is not
placed within four years after access
to suitable port, the company shall
thereupon abandon all rights. In that
event the government acquires at .
price equal to their commercial value
any wells, excluding the oil therein,
also pipelines, refineries and other
works in use or under construction,
for supplying Ethiopia's requirements.
Subject to fulfillment Of some speci-
fled requirements the company shall
maintain in good working order all
borings as long as they are economic
ally productive and limit damage to
surface lands to what Is necessary for
operation.
The company obligates itself to de-
liver Immediately and gratuitously an
tiquities found during the operations.
The company shall make and keep
at its office in Ethiopia correct and
Ineligible plans of all borings, work.
ings and operations and furnish the
government within six months after
the end of each year q report OF its
operations and within 80 days after
the end of each month statement of
the depth drilled in each well with
the result obtained. Upon the request
of the government it will furnish
copies Of all maps and plans made
by the company's staff and such other
reports as may reasonably be required.
All such will be treated as confiden-
tial by the government.
Royalties Not Disclosed.
Article eight, which concerns roy
alties, does not disclose the amounts
involved. It also stipulates that the
company shall have free all natural
gas used In the operations.
The company, II required by the
government, shall produce sufficient
petroleum and refine from it such
gasoline, kerosene and fuel oil as Il
required for local consumption. When
refining is commenced no petroleum
can be exported until Ethiopian re-
quirements are met and q reserve
established.
The price at which the Ethiopian
requirements shall be sold by the COM
pany shall be fair and reasonable, 4"
having regard for the cost of produc-
ton. refining and marketing and al
lowing reasonable profit to the COM
pany.
Representatives Of the government
will have at all reasonable times, and
to reasonable extent, the right to
inspect the company's operations.
In the event Of q state of emer-
gency, Of which the government Is
the sole Judge, the company must
do its utmost to supply petroleum and
its. products to the government to the
extent required.
Subject to certain limitations the
company may erect and use tele-
graphic, telephonic and radio appara-
tus within Ethiopia for the purposes
of the convention without charge,
observing the governments laws re-
specting such communications. The
government has the right at any
time, II the interests of the public
require. to purchase any telegraphic
or radio apparatus 50 erected.
The company may construct and
operate refineries, power houses,
workshops, tank depots, export de-
pots. domestic marketing depots, pipe
lines and stores in Ethiopia and such
railways as are necessary for its
operations.
Privileges in Detail.
It may sink. drive, build and con-
struct and operate pits, shafts, wells,
trenches, excavations, dams, drains,
water courses, factories, plans, tanks,
reservoirs. refineries, pipelines, pump
ing stations, offices, buildings, wharves
and other terminal facilities, vessels,
conveyances, ferries and bridges when
they are necessary to operations.
Such operation is subject to gov
ernment approval, which shall not be
unreasonably withheld nor q decision
unreasonably delayed.
In granting approval for ferries or
bridges suitable for public use the
government may require that they
may be available to the public sub
ject to the payment Of fair COM
pensation.
The company, upon the request Of
the Government, J win transport oil
through any Of its pipelines, provided
that In any event the quantity of oil
produced In the defined area and car
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