Evening star., 1938-04-08
ENGLAND INSISTS
MEXICO RESTORE
OIL PROPERTIES
Requests Seized Holdings
Of Agui|a Company
Be Returned.
APPROPRIATION HELD
INHERENTLY UNJUST
Cardenas Regime Receives Several
Foreign Offers for Petroleum.
Plans Cash Sales.
BACKGROUND

President Lasaro Cdrdends OF
Merico on March IS appropriated
the II American and other foreign
oil companies operating in his
country as Gilman to long labor bat
tie. CHIEF question in strained re-
lations betueen Merico and United
States is ho,O and ho,p much for
mer will compensate the seized
companies for their properties
Merico badly in need OF markets for
her petroleum.
B. the Associated Press
! LONDON. April 8-Britain has in
! formed Mexico she considers expro-
priation of foreign oil companies in
herently unjustified" and has re-
quested restoration of the holdings of
the British-owned Asuila company.
Aguila, owned by Royal Dutch Shell,
was largest of the II American. Brit
ish and Dutch companies in the
/ $400 100000 industry taken over by
President Lazardo Cardenas March Is.
The British position was made
known to the Mexican government
| through Owen ST. Clair OMalley,
Minister to Mexico City, it was an
| nounced today.
Mexican Initiative Hoped For.
| Minister OMalley was instructed to
tell Mexico the British government had
hoped the Mexican government would
! have recognized the injustice Of their
action and have taken steps on their
own initiative to adopt the only
method which can really remedy the
situation-by restoring the properties
The United States also has made
firm representations to Mexico con-
cerning the appropriation. but the
American position. as stated by Sec
retary of State Hull March 80, Is
that while Mexico's right to expro-
pirate the oil properties is admitted.
the companies must be compensated
fairly. The United States has ex-
pressed concern over the question Of
Mexico's ability to pay.
Mexico to Sell for Cash.
MEXICO CITY. April pa
cash -and-carry system on Mexican oil
production was established today as
! current reports pointed to Japan as
seeking a place in the Mexican field.
! Gustavo Espinosa Mireles, head of
the ent-controlled export oi!
company administering the II expro-
priated American, British and Nether-
lands oil companies. announced that
several offers by foreign countries were
under consideration and that all trans
actions would be on q cash basis, or
guaranteed by credit letters
This was seen as an indication the
government had altered its attitude of
selling only to democratic countries
and was now ready to sell to any one
paying cash.
Jorge Viesca y Palma, an attorney,
who said he was principal stockholder
of the Chontla Co., disclosed that jap
anese interests wanted to buy into the
Mexican oil business. These interests.
he said. had offered to buy all or part
! of his holdings.
Ex-Envoy Fears Revolution.
A market for Mexico's nationalized
oil industry must be found promptly
If revolution of extreme Left Wing
labor and peasants against the gov
ernment of President Lazaro Cardenas
Is to be averted. DIR. Noises Saenz,
former Mexican Minister to Peru. said
yesterday the New York Herald Tri-
bune reported.
The former Mexican diplomat said
overthrow of the Cardenas gov
ernment would place the country
in the hands Of Syndicalists. who
command a following not only in the
labor unions but among the Indian
peasants. The view of American
State Department officials is that the
conservatives stand as good a chance
as the extreme Left Wing of riding
into power on q revolution against the
Cardenas government, but DR.. Saenz
contended that it was automatic in
Mexico that political movements
always veered to the Left.