131 Mr O. Scott, U.K. Charge d'Affaires in Portugal, to Mr R.G. Menzies, Prime Minister

Letter LISBON, 28 July 1939

CONFIDENTIAL

You will, I expect, have received my telegram of July 19th regarding Oil Search's application for the concession in Timor.

[1]

It must be very hard both for Your Excellency's Government and for the company to understand the cause for all the delay in settling this matter and still harder to appreciate why Mr Dodson [2] can make no progress. May I say that I think Mr Dodson has shown admirable patience and restraint in most trying circumstances and that so far as I can see he has omitted no step which might have secured an earlier decision.

The position as I understand it at the present is that all the material obstacles have been overcome. The rival claimant, Mr Wittouck [3], has, I believe, been eliminated and departmental approval of Oil Search's application has been given. In this country, however, there is a great distaste for accepting responsibility and though the Minister for the Colonies [4] has had ample opportunities for taking a decision, he went away to Africa with the President of the Republic [5] without having done so, leaving authority to his substitute to settle the matter.

A new complication arose a few days ago when, if my information is correct, Dr Salazar [6] refused to accept certain recommendations of the Acting Minister for the Colonies in other matters and the latter, taking offence, adopted the attitude that he would submit no more questions to Dr Salazar during his interim tenure of office and would confine himself to the purely routine work of his department. There is one further complication, namely the friction that exists chronically between the Ministry for Foreign Affairs and the Ministry of the Colonies. I am doing what I can to persuade the Secretary-General of the Ministry of Foreign Affairs [7] to bring pressure to bear on his colleagues at the Ministry of the Colonies and I hope to see him again tomorrow or perhaps today.

I hope the foregoing may make it easier for you to realise the exact position and if Your Excellency feels disposed to send me any further instructions emphasising the political or strategical interests of the Australian Government in securing an early and favourable conclusion of this matter I shall be pleased to receive them and they may serve to strengthen my hand when talking to the Secretary-General of the Ministry of Foreign Affairs.

OSWALD SCOTT

1 Document 126. A note in the margin at this point read 'See Savingram from H.M. Charge D'Affaires rec'd on 1.8.39'.

2 A.R. Dodson, representative of Oil Search Limited.

3 Serge F. Wittouck, Managing Director of Asia Investment Company.

4 Dr F.J.V. Machado.

5 General A.O. Fragoso de Carmona.

6 Portuguese Prime Minister.

7 Dr Luiz Teixeira de Sampaio.

[AA: A1608, L52/1/1]