MEXICAN OIL FIELDS SEIZED.

Horowhenua Chronicle, 21 March 1938, Page 5

MEXICAN OIL FIELDS SEIZED.

450.000. DOLLARS WORTH OF PROPERTY. MINING COMPANIES FEAR \ SIMILAR ACTION. (By Telegraph-Press AssL.-Copyright) Received Sunday, 7.5 p.m. MEXICO CITY, March 19. Eighteen thousand workers seized control of properties of American and British petroleum companies representing an investment of 450.000. dollars after the Federal Labour Board cancelled the companies’ labour contracts on the ground that they not comply with the Supreme Court’s wage ruling, under which the companies were ordered to pay 40,000,000 dollars compensation for wages, which the companies contend is impossible.

The Government is expected to place an embargo on the companies and assume management as soon as the union, which ordered the seizure, make* a petition to this effect. 8 A later message states that President Cardenas has expropriated all Mexican oil companies, exjdaining that an embargo was too slow. At the same time the Bank of Mexico announced it was indefinitely suspending dealings in foreign exchange, presumably to halt the flight of capital from Mexico and maintain the price of the peso, although the latter is certain to drop in private dealings. The foreign mining industry, which is equal in importance to petroleum, is fearing more and more that similar nationalisation may take place in mining, due to strikes and the action of the mine unions in telegraphing President Cardenas praise of his petroleum expropriation and hinting that they would welcome similar action in their industry.

It was indicated that Washingtonwould find it difficult to ignore the situation when the workers seized the offices and ejected British, American and Dutch officials and employees of the Mexican Eagle Company controlled by Shell.

Diplomats are keeping London and Washington informed. The American Ambassador, Mr. Daniels, expressed concern over the possible effect the situation will have on President Roosevelt’s good neighbour policy.

BRITISH INVESTORS’ HEAVY LOSS Received Sunday, 7.30 p.m. f LONDON, March 19. The Sunday Times says the Mexican expropriation of oil fields will cause a £40,000,000 loss to British investors.