DRILLING HAS BEGUN IN PALESTINE—FOR OIL

Press, Volume LXXXIII, Issue 25308, 7 October 1947, Page 6

DRILLING HAS BEGUN IN PALESTINE—FOR OIL

MIDDLE EAST

[By a •’’Sydney Morning Herald" Staff Correspondent lately in Palestine.) (Reprinted by arrangement.)

4-lmost unnoticed amid the furore caused by Great Britain’s announcement of her intention., to withdraw from Palestine has been the announcement from Palestine itself that test drilling for oil began there last week. Yet before lq*ng the second announcement may prove to have far more effect on the future of Palestine than the first, for off is the great realitv of Middle East politics to-day. Oil has long been the oply material return to Britain for her annual expenditure of some £50,090,000 in maintaining the Palestine Mandate. Qil probably explains the vacillating American attitude on the Palestine question—in public an anxiety to conciliate Jewish opinion; in private a determination to safeguard American oil interests in the Arab world. Oil has almost certainly helped France to see Britain’s point of view on'the question of illegal Jewish migration, for the French Government is an equal shareholder with British, American, and Dutch interests in the Iraq Petroleum Company. Oil has brought the Dutch into the Palestine question, and has been a faqtor in influencing the Netherlands Government to seek to placate the Zionists by developing a Jewish colony in Surinam, Dutch Guiana. It is impossible to over-emphasise the significance of oil in all important political moves in the Middle East. It has given the Arab States their tremendous bargaining power at international conferences, a power which they certainly have not gained from any internal strength or even unity. Russian Interference Oil is the major reason for Soviet interference in Palestine affairs. No love is lost between the Communist Party and the Zionists, for the party has banned all Zionist activity in the Soviet. But, unable to make sufficient headway with the important Arab leaders. Russia has sought to force her way into the oil world of the Middle East by actively supporting the Jewish terrorists. To understand the supreme importance of oil in relation to the Palestine question, these three important facts should be remembered: — (1) The rate of increase of oil production in the United States has passed its peak, and within a few years the world’s main source of petroleum products will be the „ Arab States and Iran. (2) As fat as can be foreseen, the development of atomic energy will not lessen the demand for petroleum products, but may even increase the demand for them as lubricants. (3) To the extent that the 19th century strength of Great Britain was based on coal, the 20th century strength of the United States is based on oil. If the Soviet is to succeed in jte primary foreign policy aim of cracking the economic power of the United States, it must gain control of oilfields in the Middle East. Viewed in the light of these facts, Britain’s announcement of her intention to withdraw from Palestine gains a new significance. In effect, it is an ultimatum to the United States that Britain alone cannot continue a heavy expenditure from which the United States gains most of the benefit* .

Maintenance of peace in Palestine has been important to all the western Powers, and particularly to the United States, because of Palestine’s relation to the Arab oil world. Serious trouble in Palestine could easily spread througiiout the Arab. States and disrupt not only current oil production but the even more important oil search and development activities. Export Centre Palestine is also the most convenient and cheapest export centre for much of the Arabian oil production. Crude oil is brought by pipeline to Haifa, where it is refined and shipped to the United States, the United Kingdom, and other At present no oil is produced ip Palestine, but for many years geologists have advocated test drilling in tne southern desert area known as the Negeb where they believe there are large oil deposits. The Iraq Petroleum Company, which has long held oil search rights in mpst

Arab territories, formed Petroleum De velopment (Palestine), Ltd., to invest gate these reports. A pre-war survey finally recom mended test drilling near Kurnub « ancient Byzantine police post south ert Beersheba. The war came beiore anv thing could be done. After the war the I.P.C. financed an extensive geological survey by the most modern seismographic methods the whole of the Negeb region. Th, survey party was instructed, f or obvious political reasons, to carry out the work with maximum speed. In August, 1946, the survey grouo endorsed the recommendation to drift near Kurnub. and also recommended a test drill near Gaza, almost on the Mediterranean coast. This second recommendation was acted upon immediately and preliminary work bc-> gan in Gaza last September, when 1 visited the site and spoke with the I.P.C. engineers and surveyors. It was hoped to begin drilling i n April this year, but shortages ol various materials, particularly steel piping, delayed the preliminary work and drill, ing did not begin until September 26 it will take a considerable tima—probably the best part of a year—before any significant results are available as the well will probably have to be drilled to 10.000 feet through so®, very difficult rock formations. If oil were discovered at Gaza it would, of course, emphasise still further the importance of Palestine in the oil world. OU, produced right on the sea coast would be a great economic advantage for of the three methods of bulk oil transport sea transport is by far the cheapest. It is sate to assume that the possibility of finding oil in the Negeb has not been far from anyone s mind during all tlie discussions on Palestine la the last decadeinS‘ i e dWc e a^ro S a b e°h W ?o*ttt: ticular part of Palestine. At one stage, seemed said it would not expect either the Jewish or the Arab State t 0 take on the economic burden of the Eouthem . desert, which would therefore remain under British control. Both Arabs and Jews then pleaded that they would like to be burdened with the Negeb—the Arabs because it was the traditional home of the roving Bedouin, the Jews because they said by hard work and careful husbandry they could make the desert bloom once more. Throughout this discussion no mention was made of oil, but all the time the I.P.C. oil survey was continuing and each of the three parties must have been well aware of the possibility that the Negeb might prove one cf the richest plums al the whole Middle East. Potential Value of Negeb Petroleum Development (Palestine), Ltd., as a subsidiary wholly owned by LP.C., represents British, American. French, and Dutch interests. Its right to search for oil in Palestine has been given it by th* present administration set up by the British under th* League of Nations Mandate. It is a matter lot conjecture what the company’s position might be under a change of conI.P.C. is not a company which likes any Of its rights being a “matter for conjecture.” It is obvious that tne oi! interests will have been gravely disturbed by the British decision to withdraw and they will make every effort to ensure that whatever new form of government is brought to Palestine iheir oil right, will not be affected Moreover, these oil interests are closely identified with national interests. The French, and Dutch Governments all nave direct holdings in 1.P.C., while the voices of Standard Oil and Socony-Vacuum do not find it hard to make themselves heard io Washington. The threat of Soviet infiltration into and eventual dominates of the Middle Eastern qil fields is s real one which the Western Powers will not regard lightly. Oil, then, is the clue to much that is *said and efbne about the future . of Palatine. I remember interviewing an I.P.C. executive in Jerusalem who said to me across his desk littered with plans and reports: “I often look at the P&pers passing through my hands and think that I am seeing more concerning the real future of Palestine than all the delegates to all th® conferences put together.”