Such was the situation when France went to the Conference of San Remo.
The San Remo Agreement
It was not merely the oil deposits of Mesopotamia that France, in return for a lowly and subordinate participation in British control, was abandoning to Britain—as they would have had the Chamber believe at the time of the noisy debate upon Mosul—but the whole of French oil interests, present and future, whether in the colonies or abroad. The first article of the agreement which Mr. Lloyd George and the real "Grand Master" of British oil policy, Sir John Cadman, presented for signature, stipulated, it is true, that "this memorandum relates to the following States or countries: Rumania, Asia Minor, territories of the old Russian Empire, Galicia, French Colonies," and that the agreement might be extended to other countries by mutual consent; but, of British territories, only "British Crown Colonies" were opened to French co-operation, and then only "so far as existing regulations allow." Thus, London kept an easy method of evasion in reserve. Now, though the British Empire counts many "Dominions," there is not nowadays a large number of "Crown Colonies." The former German Colonies themselves, with one exception, have been handed over to the Commonwealth of Australia, or to New Zealand, or to the Union of South Africa. Thus, apart from former German East Africa and a small strip of the Cameroons which France ceded to Nigeria, these will not be open to "Franco-British co-operation."
There is but a single country in which the San Remo Agreement has provided equal treatment for France and Britain, at least in theory; that country is Rumania.
Rumania is the State in which French interests were the most important; they would be increased still more by the spoils of the Deutsche Bank and the Disconto-Gesellschaft. Accordingly, the two Governments pledged themselves to support each other in acquiring concessions which belonged to sequestrated companies, such as the Steaua Romana, Concordia, and Vega, and in obtaining fresh concessions. "All shares belonging to former enemy concessions which can be secured and all other advantages derived from these negotiations shall be divided, 50 per cent. to British interests and 50 per cent. to French interests. It is understood that in the company or companies to be formed to undertake the management and the exploitation of the said shares, concessions, and other advantages, the two countries shall have the same proportion of 50 per cent. in all capital subscribed, as well as in representatives on the board, and voting power."
This equality was not a favour, for the French capital invested in Rumanian oil was at least as important as that of Britain.
In the territories of the old Russian Empire, where French interests are much less important than British interests, an equal distribution is not provided for: it would have been to the advantage of France. But it is stated that the two Governments will give their "joint support" to those of their nationals who make "joint efforts" to obtain concessions, and to export and deliver oil. Now, at the present moment, such efforts are being made by the Royal Dutch-Shell alone, which is even going to the length of proposing to the Soviet Government to restore the oil industry of Russia, if it is granted extra-territoriality for its concessions.
In Mesopotamia, "the British Government undertake to grant to the French Government 25 per cent. of the net output" if the Mesopotamian oil-fields are developed by Government action. If a private company is used, the British Government will place at the disposal of the French Government a share of 25 per cent. in such company. Thus, in the one case France will be simply a consumer of oil, or in the other she will be both a producer and a consumer. The negotiators took care to have inserted that "the price to be paid for such participation shall be no more than that paid by any of the other participants." They remembered the price at which British coal had been sold them!