(لا تقوم الساعة حتى تعود جزيرة العرب مروجاً وأنهاراً)
(حديث : صحيح الترمذي)
The Hour of Reckoning will not strike until the Arabian peninsula turns again into lush meadows and flowing rivers.
(Hadith: Sahih-ut-Tirmidhi)

With the unification of Central Arabia and the emergence of a stable government there, it was inevitable that the commercial moguls of the outside world would begin to wonder what treasures might lie under Arabia’s desert sands, and set about obtaining permission to search for them. The possibility that oil might be found in the country had been known for some years, since 1927 it was already being exploited in Iraq and Persia, which had similar geological features.

In 1923, three years before I joined the Court, the first oil concession had actually been signed. An adventurer from New Zealand by the name of Major Holmes, acting on behalf of an English group calling itself the  ‘Eastern & General Syndicate’. managed to obtain an introduction to Ibn Saud. After some months of sporadic discussion, Holmes was granted an exclusive concession to explore for oil and other minerals in the Al-Hasa area. Although nobody knew it at the time, the territory covered by the concession contained almost all the vast oil deposits in the Eastern Region, upon which the world now finds itself so dependent. The Al-Hasa concession was to last for seventy years, at the astonishing bargain price of £2,000 in gold per annum, payable in advance. Everybody seemed content with the agreement. Holmes had obtained most favourable terms for his syndicate and Ibn Saud, who believed that God had endowed his kingdom with plenty of sand but precious little else, was more than happy to allow foreigners to pay him £2,000 a year for the privilege of discovering that his country contained no oil. Strangely enough, almost no serious exploration was done by the Eastern & General Syndicate, and after paying two years’ rent totalling £4,000, they seemed to lose interest altogether. No further rent was forthcoming from them and in 1928, after three years had passed without payment, the King terminated the concession. At that stage he regarded himself as being owed £6,000 by Holmes and this fact, as will be seen, was to assume some importance later on in  the story of Arabia oil.

No further approaches for concessions were made until 1930. In that year His Majesty was in very serious financial trouble, for the world-wide slump had drastically reduced the number of pilgrims coming to Mecca, and the King’s revenues from Hejaz had dropped dramatically. Despite all the ingenuity of Suleiman, the situation had become very grave. The King was having difficulty in paying his foreign debts and even his staff. Even so, I do not think that further attempts to exploit the country’s mineral wealth had even occurred to him as a way of resolving his problems until he was approached by an American by the name of Charles Carne. Carne was a Quaker millionaire, a former in American minister to China, and very influential figure in American appointees to the King-Crane Commission on Syria and Palestine which reported in 1919, and had also visited the Yemen, so he was not unfamiliar with the Middle East. Crane had developed a genuine, if sometimes rather eccentric, desire to hasten the progress of the emerging states in the Middle East. He was not, in fact, completely unknown to the King. During my first December in Riyadh in 1926, one of the weekly mail-bags from the Foreign Office in Mecca contained a cable sent from Geneva. It read: ‘To His Majesty King Ibn Saud. I am interested in Arabia and desire to meet Your Majesty if permitted. Charles Crane, friend of the Arabs.’ Friend or not, His Majesty had no idea at the time who Crane was or what he wanted, and he certainly did not have the time to meet every foreign well-wisher who desired to see him. The Foreign Office was therefore instructed to cable a polite refusal, which read: ‘The time is not propitious as His Majesty is busy with the approaching hajj season and internal affairs.’

Not to be put off, Crane cabled again in 1927, this time from Cairo, saying that he would like to see the King. Again, no details were given as to why Crane wanted to come. The cable arrived just after the hajj, and the king was in Mecca about to return to Najd. A telegram was sent in reply, explaining that the King was about to return to Riyadh and unfortunately there was no time for a meeting. Crane was nothing if not persistent. He went to Basra and made arrangements to drive into Najd by car via Kuwait. In this project he enlisted the help of John Vaness, an American missionary in Basra, who lent Crane one of his young assistants to guide him as far as the Kuwait border. The pair set off in two separate cares, accompanied by Arab guides and servants. Most unfortunately, while there were driving through Kuwait, they encountered an Ikhwan raiding party, made up of members of the Ajman tribe under Dhaidan Ibn Huthlain. The raiders immediately opened fire on the cars. Both vehicles managed to escape, but not before the young American missionary had been hit and killed. When news of the incident reached Riyadh, the King was furious. Of course, nothing could be done, and Crane had already been forced to return the way he had come. By now, His Majesty was impressed by Crane’s perseverance and was happy to agree to a meeting with him. The American was in Cairo at the time, having recently completed a programme of road- and bridge-building in the Yemen. It was therefore an easy matter to arrange with him that he would visit Jeddah early the following year.

Crane arrived in Jeddah in February 1931. His Majesty travelled to the city especially to meet him, and the American was treated to a magnificent reception. The guards and retinue of the King put on a grand display of ceremonial war dances; this was followed by a similar performance by the inhabitants of Jeddah, among whom the Hadramis were particularly impressive in their dancing. Crane was invited to a number of state banquets and was given the honour of being accommodated in Sheikh Mohammed Nassif’s house, which until then had always been used by the King himself when he was in the city.

The American remained in Jeddah until the beginning of March, and had several lengthy discussions with the King and Suleiman. Crane’s vision of Arabia was one of splendid factories, massive dams, great highways and gleaming bridges, all of which could be built by his engineers once the riches of the country had begun to be exploited. The King and his Finance Minister listened politely, but what was immediately required was cash, not concrete, so that His Majesty could pay his staff and his foreign debts. At all events, before anybody’s dream could be realized, it was necessary to discover whether Arabia did indeed have any underground minerals, and Crane promised to supply an expert surveyor to look for them. The agreement reached was that Crane would pay the surveyor’s salary and the King would provide him with all the necessary food, accommodation and transportation, together with a personal guard. After this had been arranged, Crane left Jeddah with as much ceremony as when he had arrived, having received from His Majesty a kingly gift of two fine Arabian horses.

Two months later, Karl Twitchell arrived in Jeddah. Twichell was civil and mining engineer, who had already worked for Crane in the Yemen and had been commissioned by him to carry out the necessary surveys. He was put to work immediately. His first task was to visit the neighbourhood of Jeddah and the spring of Aziziyah in the adjoining hills, to see what could be done to improve the city’s notoriously inadequate water supply. Then he went to a journey down the Red Sea coast to Jizan and Yanbu, taking with him a translator I knew, called Ahmed Fakhry. Subsequently he travelled to Najd, where he paid particular attention to the area around Ar-Rass and Niffi. In this region he found a hillock with veins of gold, and the ruined remains of an old mining village. Some of the derelict dwellings still contained the remnants of grinding stones which had been used to crush the rock dug from the hill. Despite the fact there still seemed to be gold present in encouraging quantities, Twitchell did not think it worth trying to extract it, as modern methods required greater quantities of water than were available in the area. After returning to Jeddah for a time, Twitchell travelled back through Najd To Al-Hasa, this time accompanied by Najeeb Salha as translator. There he spent several months compiling a detailed report on everything he saw. He paid particular attention to the oases of the region, and became enthusiastic about the possibility of making the desert flower by irrigation. Among other minerals in the area, he noticed outcrops of gypsum near Dhahran. Finally, after spending about eighteen months in Arabia, he found geological formations in the Dhahran area which pointed strongly to possible reserves of oil.

Twitchell took his reports to the King and explained what would be needed to search for the oil and what would happen if it were found. Like Crane, he spoke in lyrical terms of cities, roads, railways, airport, schools, hospitals and the other paraphernalia of modern industrial state, all of which could be created by oil wealth. Despite Twitchell’s enthusiasm, His Majesty was sceptical, still believing in his heart that there was nothing but valueless rock under his barren desert. However, he agreed that if there was any oil in his kingdom, something should be done to get it out and sell it. At about this time, Prince Faisal was due to go on a visit to England. On His Majesty’s instructions, I personally gave the Prince a copy of Twitchell’s report. While in England, Faisal handed the report to the British government and, as his father had asked him,offered to give the British the Al-Hasa oil concession. Shortly afterwards, the King received a telegram from the British Embassy in Jeddah to the effect that the British government was obliged for the offer but was not interested.

It is perhaps surprising that Ibn Saud should have offered his oil to the British after its possible location had been found by the Americans, and even more surprising that the British should have turned it down. I think that the reason for the King’s gesture was probably that he felt in debt to the British for the help they had given him in the past, and thought that this gesture of goodwill might go some way towards repaying it. The refusal of the offer by the British could, of course, have been due simply to stupidity, but I suspect that there were other influences at work. I have always thought it likely that there was an unwritten agreement between the international oil companies and the British and American governments to the effect that the British would control oil reserves to the east of a line drawn from the north of Iraq down to Qatar, while the Americans had everything to the west of the line. The British, after all, already dominated oil production in Kuwait, Iraq, Qatar and the Trucial States, and to a large extent in Bahrain, and at that time this was ample for their needs. There was much to gain by bringing the Americans into the area, for it would give them a powerful economic interest in Arabia. This, in turn, would encourage them to make a military alliance with the British to defend the region against the potential enemies of both countries.

At all events, whatever the reason, the British did not want the oil concession. Ibn Saud’s next move was to try to reach an agreement with Twitchell himself, whom he had come to admire and trust. Sheikh Yusuf Yassin and Fuad Hamza, on behalf of the King, asked Twitchell to form a national oil company for the Saudi government. As General Manager of the company, Twitchell was to receive ten per cent of the profits. He declined, however, on the grounds that he did not consider the venture to be practical. With increasing admiration for Twitchell’s bargaining skill, Yassin raised the proposed percentage to fifteen per cent and finally to a stagering twenty per cent. When Twitchell still refused, in finally dawned upon the King’s negotiators that Twitchell actually meant what he said; he quite genuinely did not believe the venture to be feasible. I think another reason he refused was that he was perfectly happy as a surveyor and had no particular ambition to become an oil tycoon. He was, however, more than willing to help the King, and promised to take a copy of his report to America to see if he could find a company there which would be interested in the oil concession. Everybody in the Court was glad that the Americans seemed likely to get the concession, for we all felt that the British were still tainted by colonialism. If they came for our oil, we could never be sure to what extent they would come to influence our government as well. The Americans on the other hand would simply be after the money, a motive which the Arabs as born traders could readily appreciate and approve.

Before Twitchell left, he came to me and said that he did not know to whom he should write in the Court. If he found a company interested in the concession he would therefore write to me; he asked me to translate any letter he sent and present it to the King. about a month after he left I received the promised letter. I translated it and gave it to His Majesty, who in turn passed it to Suleiman. The letter informed the King that Twitchell had found a company interested in exploring the oil prospects, and that he was prepared to come and negotiate an agreement on behalf of the company. I wrote to Twitchell acknowledging his letter. All further correspondence took place between Twitchell and Suleiman and I did not see any of it personally.

Suleiman must have invited Twitchell to Jeddah, for in due course he appeared, accompanied by a Mr Lloyd Hamilton of the Standard Oil Company of California. His Majesty instructed Suleiman to form a committee to negotiate with the Americans, and Suleiman decided to do this himself, together with Sheikh Abdullah Mohammed Al-Fazal and Sheikh Hassan Al-Gossaibi. The King asked me to accompany the committee as translator. The committee took rooms in the Baghdadi Building in Jeddah and talks with the Americans started immediately. As the long and tricky negotiations proceeded, it became obvious that the principal obstacle was the question of the initial payment to be made for the concession. Since the King still doubted that any oil existed at all, he was much more interested in obtaining a sizeable down payment for exploration rights than he was in possible future royalties. Suleiman was therefore demanding a ‘loan’ of £100,000 as a condition of granting the concession. The sum was to be repaid, if at all, from royalty payments as and when oil became available in commercial quantities. The company had in mind a much lower figure in the order of £25,000.

Shortly after Hamilton and Twitchell arrived in Jeddah, they found themselves with some rather unexpected competition. A deputation from the British-owned Iraq Petroleum Company arrived in Jeddah, led by a man named Longrigg. They were followed by the appearance of none other than Major Frank Holmes, accompanied by an Armenian translator. Major Holmes’s stay in Jeddah was extremely short. He was met by Sheikh Abdullah Suleiman and myself and the conversation which followed was, from Holmes’s point of view, distressingly brief. Holmes assured us that he represented ‘Mellon interests’ and ‘The Gulf Group’, which he said was a very big company. He assured us that a magnificent, but unspecified, deal could be made with his company if he was given the concession. Suleiman was not impressed. He remained Holmes that he still owed the government £6,000 in respect of the previous concession which had been allowed to lapse. He added that, since Holmes’s reliability was obviously open to question, he required the Major to make a payment of ‘earnest money’ before any negotiations could take place. A figure of 200,000 riyals was mentioned. Holmes was not prepared to pay this and was probably afraid that, even if he did, it would simply be confiscated on account of the unpaid rent owed by the Eastern & General Syndicate. I think that he probably arrived in the expectation of being able to pull the wool over the eyes of the Saudi government a second time, and securing the Al-Hasa concession for a nominal sum. Once he realized that this was out of the question, he caught the next ship out of Jeddah and was never seen again.

The IPC delegation, which was met by Philiby and Suleiman, lingered in Jeddah rather longer than Holmes had done. They were somewhat like figures from Alice in Wonderland while they wandered about the city in a distracted state, moving from place to place as if they had lost their way. IPC were never seriously in the running for the concession because, as it turned out, they were never prepared to offer anything like as much as the Americans in the matter of the all-important initial loan. However, the Americans did not know this at the time, and the very presence of IPC made life much more difficult for Hamilton and Twitchell, who were no longer the only runners in the field and were worried that at any time their rivals might be able to outbid them.

At first I was asked to translate for Twitchell and Hamilton as well as for Suleiman. Then all of a sudden, Philby become involved in the negotiations and took over as translator for the Americans. He had apparently been appointed by Standard Oil to represent them in the discussions. This was a shrewd move on their part, because nobody knew better than Philby what sort of offer was likely to be acceptable to the King. I never quite understood how Philiby managed to reconcile his position as self-appointed and impartial adviser to the King with that of paid agent for one of the two international companies who were competing for His Majesty’s oil. In fact, at the same time as he was negotiating on behalf of the Standard Oil Company with Suleiman, he was also having meetings with IPC in which he represented the Saudi government! But whatever his motives, I think that Philby must still have had the interests of the King at heart because the eventual result, as will be seen, was most beneficial for our country.

The discussions with the Americans continued much as before, with Twitchell and Hamilton trying to dissuade Suleiman from pressing for a lump sum by painting rosy pictures of the benefits and prosperity which would accrue to the nation once oil was discovered. Suleiman, on the other hand, came back again and again to the simple point that, however much jam there might or might not be tomorrow, His Majesty needed jam today. Philby helped to break the impasse. I remember him saying to Twitchell, ‘These Arabs do not understand your theoretical and abstract explanations of what will happen in the future. They want to know something concrete – what they well get now. You will have to offer them a lump sum or risk losing the concession altogether.’

Eventually the Americans were convinced that a large down payment really was necessary, and after much additional talking, a provisional agreement was reached. Briefly, it gave the Al-Hasa concession to Standard Oil for sixty years in exchange for an initial interest-free loan of £30,000 in gold and a second loan of £20,000 in gold within eighteen months. There was to be an annual rental of £5,000 in gold, and a further loan of £15,000 in gold to be made as soon as oil was discovered commercial quantities. Thereafter, the government would receive royalty payments at the rate of four shillings per ton of crude oil extracted. These terms were discussed between Suleiman and the King and, on Philby’s advice, His Majesty decided to accept them. His instructions to Suleiman were as always simple and direct: ‘Put your trust in God and sign!’ The concession was signed by Suleiman and Hamilton in Jeddah on 29 May 1933. The Saudi Arabian oil age had finally begun.

The sequel is well known. The search for oil was initially fruitless and everybody’s hopes sank (except those of the King, who never expected oil to be found anyway). Then in 1935 a trial well drilled in Dhahran proved the existence of oil in commercial quantities. As time passed, the true and staggering size of the oilfields was established. Production began in 1938, but fell almost to nothing during the Second World War. After that, it rocketed to the huge volumes produced today. The Standard Oil Company became first the California Arabian Standard Oil Company and finally Arabian American Oil Company, or Aramco as it is now universally known. The King found himself richer than he had ever imagined possible, and was able to use his new wealth to initiate public works of all kinds to the benefit of his people. Thus was set in motion, under the wise leadership of Ibn Saud, the process of rapid growth and modernization by which all of us in Saudi Arabia have been so enriched.