Resistance is futile

December 1st, 2002

Bob Cringely suspects that once their attempts to outlaw file sharing fail to kill the peer-to-peer networks, the recording industry will build a "legal" peer-to-peer network of their own. Oddly enough, he doesn't think that users' interests will be at the top of the recording industry's agenda, and eventually users will turn back to independent peer-to-peer systems.

None of this is terribly original thinking, but I do like the historical precedent Cringely wheels out to illustrate his point:

My favorite historical example of this phenomenon comes from the oil business. In the 1920s, the Anglo-Persian Oil Company had a monopoly on oil production in the Middle East, which they generally protected through the use of diplomatic — and occasionally military — force against the local monarchies. Then the Gulf Oil Company of Pittsburgh, Pennsylvania, literally sneaked into Kuwait and obtained from the Al-Sabah family (who still run the place) a license to search for oil.

The Anglo-Persian Oil Company did not like Gulf's actions, but they were even more dismayed to learn that Gulf couldn't be told to just go to hell. Andrew Mellon, of the Pittsburgh Mellons, was the U.S. Secretary of the Treasury, and he wasn't about to let his oil company be pushed around by the British Foreign Office. So Anglo-Persian and the Foreign Office did their best to delay Gulf, which worked for several years. They lied a little, lost a few maps, failed to read a telegram or two, and when Gulf still didn't go away, they turned to acting stupid. As the absolute regional experts on oil exploration, they offered to do Gulf's job, to save the Americans the bother if searching for oil in Kuwait by searching for them.

The Anglo-Persian Oil Company searched for oil in Kuwait for 22 years without finding a single drop.

Remember that Kuwait is smaller than Rhode Island, and not only is it sitting atop more than 60 billion barrels of oil, it has places where oil has been known for more than 3,000 years to seep all the way to the surface. Yet Anglo-Persian was able to fulfill its contract with Gulf and keep two oil rigs continually drilling in Kuwait for 22 years without finding oil. To drill this many dry wells required intense concentration on the part of the British drillers. They had to not only be NOT looking for oil, they had to very actively be NOT LOOKING for oil, which is even harder.

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5 Responses to “Resistance is futile”

  1. Ray Girvan Says:

    This is a neat conspiracy story – maybe too neat. I'd be interested in corroborative sources, as some of the dates seem very dodgy. A Google search for "Anglo-Persian Oil Company" finds various more standard histories that agree on the following timeline:

    APOC didn't approach Kuwait to negotiate rights to explore for oil until 1930. The Gulf/APOC joint venture, Kuwait Oil Company, wasn't formed until 1934. The major Burgan field was discovered soon (the Burgan-1 well went online in 1938). True, there was a delay in exploitation and further exploration – but due to World War II. Nevertheless, work restarted post-war, and by 1953 Kuwait was the largest oil producer in the Gulf.

  2. Ray Girvan Says:

    This is a neat conspiracy story – maybe too neat. I'd be interested in corroborative sources, as some of the dates seem very dodgy. A Google search for "Anglo-Persian Oil Company" finds various more standard histories that agree on the following timeline:

    APOC didn't approach Kuwait to negotiate rights to explore for oil until 1930. The Gulf/APOC joint venture, Kuwait Oil Company, wasn't formed until 1934. The major Burgan field was discovered soon (the Burgan-1 well went online in 1938). True, there was a delay in exploitation and further exploration – but due to World War II. Nevertheless, work restarted post-war, and by 1953 Kuwait was the largest oil producer in the Gulf.

  3. John Says:

    The account at http://www.archiveeditions.co.uk/Leafcopy/210-5.htm confirms both that Gulf held an option with respect to Kuwait's oil from the late 1920s, and that it was only in 1934 that the APOC/Gulf joint operation got under way. It appears from the chronology given towards the foot of the page that there were an awful lot of delays in the negotiations, but it's not clear how much of this was down to the political interference by Andrew Mellon which Cringely cites. On the basis of this, it does look as if Cringely can only arrive at the figure of 22 years by lumping together several years of political stalling, some 'cooperation' from APOC and a world war.

    It's a shame that the facts get in the way of a good story like this…

  4. Ray Girvan Says:

    A further crit of Cringely's piece: as an ex-geologist, I can comment that the detail "oil has been known for more than 3000 years to seep all the way to the surface" is pretty irrelevant. Geologically, this might indicate small surface deposits (as in Castleton, Derbyshire) or a region of low-grade oil-bearing rock (as in Kimmeridge, Dorset). It's not an indicator of major oil deposits.

  5. John Says:

    Oh well, I should have known it was too neat a story to be true…