Fair Share for Standard

In the biggest investment of U.S. private capital made in Italy since war's end, Standard Oil Co. (N.J.) last week paid $10 million for a half-interest in two Italian refineries, plunked down another $2,000,000 for purchase of extra equipment. To help safeguard the investment Standard got an EGA guarantee that it can convert at least $14,487,500 of its Italian dividends into dollars over the next twelve years. It is the largest EGA guarantee yet, the first to an oil company. By the deal, Standard got 50% of the capital stock of Italy's ANIC (Azienda Nazaionale Idrogenazione Combustibili), 40% controlled by the Italian government.

The deal gives Standard a nicely rounded program in Italy. The refineries will buy crude from Standard's Near East fields (thus saving Italy $4,200,000 annually in dollar imports), will sell refined products to SIAP (Standard-Italo Americana Petroli), Standard's Italian marketing subsidiary. Standard would also like to drill for oil in the Po Valley, where government-subsidized explorations have already struck a rich supply of methane gas. But Standard has run afoul of the old Italian law, which gives the government absolute title to all oil and minerals discovered beneath the surface of the earth. Standard wants the law amended before it sinks any U.S. dollars into Italian soil.

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