2. A line from Sivas to Erzerum and on to the Persian and Russian frontiers, with branches to the Black Sea ports of Tireboli and Trebizond.

THE CHESTER CONCESSIONS

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3. A line from Oulu Kishla, on the Bagdad Railway, to Sivas via Kaisarieh.

4. A trans-Armenian railway from Sivas to Kharput, Arghana, Diarbekr, Mosul, and Suleimanieh, including branches to Bitlis and Van.

5. A railway from Kharput to Youmourtalik, a port on the Gulf of Alexandretta.

No more elaborate project for railway construction in Asiatic Turkey has ever been incorporated in a definitive concession. That it should be entrusted to American promoters and American engineers is one of the most significant developments in the long and involved history of the Eastern Question.

But the Chester concessions do not stop at railway construction alone. As in the case of the Bagdad Railway, the Turkish Government is obliged to offer the financiers powerful inducements to the investment of capital in railway enterprises which, in themselves, may be unremunerative for a time. The German promoters of the Bagdad Railway obtained a kilometric guarantee, or subsidy; the American promoters of the Chester lines are granted exclusive rights to the exploitation of all mineral resources, including oil, lying within a zone of twenty kilometres on each side of the railway lines. The Bagdad Railway mortgaged the revenues of Imperial Turkey; the Chester concessions mortgage the natural resources of Nationalist Turkey. The Ottoman-American Development Company, furthermore, is authorized to carry out important enterprises subsidiary to the construction of the railway lines and the exploitation of the mines aforementioned. It may, for example, lay such pipe lines as are necessary to the proper development of the petroleum wells lying within its zone of operations. It is permitted to utilize water-power along the line of its railways and to install hydro-electric stations for the service of its mines, ports, or railways. It is required to construct elaborate port and terminal facilities at Samsun, on the Black Sea, and at Youmourtalik, on the Gulf of Alexandretta.

There are other respects in which the terms of the Chester grant are strikingly similar to those of the Bagdad Railway concession of March 5, 1903.[44] Lands owned by the Turkish Government and needed for right-of-way, terminal facilities, or exploitation of mineral resources are transferred to the Ottoman-American Development Company, free of charge, for the period of the concession (ninety-nine years). Public lands required for construction purposes—including sand-pits, gravel-pits, and quarries—may be utilized without rental, and wood and timber may be cut from State-owned forests without compensation. As public utilities, the Chester enterprises are granted full rights of expropriation of such privately owned land as may be necessary for purposes of construction or operation. Like the Deutsche Bank, the Ottoman-American Development Company is granted sweeping exemption from taxation, as follows: “The materials, machines, coal, and other commodities required for the construction operations of the Company, whether purchased in Turkey or imported from abroad, shall be exempt from all customs duties or other tax. The coal imported for the operation of the [railway] lines shall be exempt from customs duties for a period of twenty years, dating from the ratification of the present agreement. For the entire duration of the concession the lines and ports constructed by the Company, as well as its capital and revenues, shall be exempt from all imposts.”[45]