OIL: Welcome Mat in Mexico

Since they were forced out of Mexico in 1938, most major U.S. oil companies have shown little desire to go back in, despite repeated invitations. Last year, Cities Service Co., the only one that had not left Mexico, took on a job of drilling new wells. But otherwise, the best deal that Antonio J. Bermudez, boss of Pemex, Mexico’s oil monopoly, could make was with J. Edward Jones, a small U.S. oil promoter, to drill 100 wells (TIME, Sept. 22, 1947). He drilled one, and it was dry.

This week, Bermudez, still trying to get U.S. know-how to help his inefficient monopoly, landed a bigger fish. He signed a contract with a new company, the Mexican American Independent Co., giving it a twelve-year concession to drill wells along Mexico’s tidelands near Yucatan and elsewhere. The new company was formed when Edwin W. Pauley, California oilman and good friend of President Truman, joined up with Ralph K. Davies. of the American Independent Oil Co. (TIME, Sept. 1, 1947) and Samuel B. Mosher of California’s Signal Oil & Gas Co. The new Pauley company would, get 50% of all production until its drilling expenses were paid. After that, it would get 15% of the production as profit.

Pacific Western Oil Corp.’s J. Paul Getty closed his big deal with King Ibn Saud of Saudi Arabia, for the oil concession in the King’s half of the “neutral zone” between Arabia and Kuwait on the Persian Gulf (TIME, Feb. 21). Getty expects to start drilling in a few months, and will develop the zone with the American Independent Oil Co.