Word: saudi
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Dates: during 1950-1959
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Abstentions: Afghanistan, Egypt, Indonesia, Pakistan, Saudi Arabia, Sweden, Syria, Yemen, Yugoslavia...
...earthenware cups of tea and thick coffee, they scratched their signatures to a historic document. When the news of its contents came out last week, it delighted other oil-rich Middle Eastern nations, but it dismayed Great Britain. Davies,* in revising Aramco's 17-year-old agreement with Saudi Arabia's King Ibn Saud, had given him the most generous deal ever made in all the turbulent history of Middle Eastern...
...effect, Aramco made old Ibn Saud an equal partner, who would share & share alike in all of Aramco's profits, including 1950's whopping net (before royalties) of $180 million. For Ibn Saud and Saudi Arabia, it meant a kingly take of $90 million, 50% more than the $60 million that would have been paid under the old royalty payments of 34? a barrel. If, as expected, Aramco rings up an operating profit of $200 million in 1951, Ibn Saud will get half of that...
Davies then offered the flat 50-50 split in return for two important concessions: Abdullah promised in the written contract that the arrangement would be his top demand; he also agreed that Aramco, instead of paying entirely in U.S. dollars and sterling as before, could pay Saudi Arabia in the currencies it takes in from sales. With this assurance, Davies believed that Aramco could do more business in Italy, France and other soft-currency markets (95% of Aramco's market is outside...
Take a Lesson. Aramco was reasonably happy with the deal. After investing $400 million in Saudi Arabia, it had boosted production 46-fold in a decade, to a rate of 650,000 barrels daily (equal to 11% of all U.S. domestic production). With the prospect of an expanding market, and with its development work largely completed, Aramco recognized that Saudi Arabia was entitled to a bigger share than it had gotten during the years of exploration work...