Evening star., 1941-02-15
Congress Of Mexico
Expected TO Approve
Oil Field Reopening
Little or No Changes
Believed Likely in
AviIu Cumocho's PIon
BY the Associated Press


By the Associated Press.
MEXICO CITY, Feb. l5-Politi-
cal observers today predicted that
the special session of Congress
would approve, practically without
change, President Manuel Avila
Camacho's proposals for reopening
MeXicos vast oil resources to private
development and restricting laborS
right to strike.
These observers characterized the
proposals submitted yesterday as
swing from the middle of the road
TO the right by the conservative
Avila Camacho administration.
In effect. they said, the measures
would set aside two principal tenets
of the administration of Gen. LaZaro
Cardenas, who exploded foreign ex-
ploitation of MeXico's S400 900, 900
Oil industry in 1888 by expropriating
the petroleum industry.
Cardenas held that the nation
should organize its national econ
omy productivity and efficiently
without foreign capital. and regard
ed an unrestricted right TO strike as
labors proper weapon.
To Safeguard Interests.
Avila Camacho's message yester-
day made clear that the govern
ment intends 10 safeguard its finan-
clal interest as owner of the oil
The modifica tions. Avila Camacho
told Congress, ARE designed TO make
attractive the leasing of petroleum
fields from the nation, placing such
leases on a financial basis more in
accordance with the realities of our
capital market, with the essentially
speculative nature of the enterprise,
and with accepted business stand
ards"
Observers pointed out that gov
eminent operation of the Oil fields
taken over from United States,
British and Netherlands companies
had run deeply into the red. 1t was
estimated the government lost sl4,-
100000 in the first % months of op-
Grating the industry. Recently wages
were cut and drastic economies
effected in an effort to show a profit.
1t was understood that under the
Presidents proposal the government
would participate in and control any
privately financed companies estab-
llshed with foreign capital.
The government also would ex-
pect that the nation "as the owner
of the oil should receive first bene-
fits from exploitation.
Demand Management Rights.
Petroleum companies who fought
the appropriation have not insisted
on outright ownership if they re-
turned TO the Mexican fields. but
have demanded clearly defined
management rights and guarantees
OF a fixed percentage of profits.
In his message on strikes Avila
Camacho declared abuse of this
right had "ruinouS consequences
for national economy"
A preamble TO the labor amend
mentS said the right TO strike was
historic but had been put 10
Illicit use. Stout opposition was
expected from Mexicos liberal and
labor elements. but they are in the
minority
The proposed amendments would
require workers who decide TO strike
to notify their employers and the
Federal Labor Board at least six
days in advance. The employer
would be required to file an answer
with the board within 48 hours set
ting into action Federal conciliation
machinery.
Would Be Ordered Back.
Strikers walking out without such
advance notice would be ordered
back within "a hours. If they re-
fused their labor contracts would
be voided and their employer au-
thorized TO hire others in their places
The Presidents message declared:
The suspension of work before
all resources of Cancellation have
been exhausted unnecessarily makes
possible irreparable damage to the
stability of employment. to the pro-
ductive capacity of industry and 10
the economic life of society
Seventeen United States. British
, and Netherlands oil companies
owned the properties appropriated
March 18. 1888. by the Cardenes de-
cree The companies set valuation
at more than S4O0 100000. a figure
which the Mexican government
called excessive.
The Mexican Supreme Court in
December, 1899. unanimously upheld
the appropriation as constitutional.
American companies petitioned
the State Department in Washing
ton to intervene Mexico countered
with a note saying she considered
the appropriation issue domestic in
nature" and rejected an offer TO
arbitrate.
In May, 1910. Mexico completed a
| separate agreement settling the
Consolidated Oil Corp. tSinclair) ex-
preparation claims for $500 900.
with the compsny agreeing to buy
100000 barrels of Mexican crude
Oil over three-year period.
No agreement was reached. how
ever. with the firms hardest hit by
the eXpropriation-the Royal Dutch
interests of Great Britain and the
Netherlands and Standard Oil of
New Jersey.
tco c7E lanai O.LL.,