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5/15/54: Reel 3, Track 2, Page 1 MR. McGHEE (?) As I remember this discussion ahout price, on this very first day, when you first met him, he said, "Will you make a deal if I seil the oil at three pounds per barrel-per ton?" Remember this? MR. ACHESON: Yes, I remember that. MR. McGHEE: (?) We thought about this and finally came to the conclusion that this we could not quite do. MR. NITZE: (?) What did that amount to per barrel, do you recall? MR. McGHEE: (?) Dollar twenty. See, he went down twenty per cent from a dollar seventy-five in the discussions with us, which evidently was as much as he was permitted to go down; and we talked with him in terms of a dollar five, which us if he had borne the cost of production would correspond to the amount that governments in the Persian Gulf area were receiving. MR. ACHESON: But in all these discussions, the thing that Averell thack spoke about earlier and always caem up. After you'd talked an hour and a half6 you were almost somewhere, you discovered you were right back where you started from and the last hours' discussion washed out. MR. McGHEE: (?) He reneged on only one point in his discussions with you that he had told us previously-a very important one. He told us he'd be willing to have a certain number of Englishmen, and he even mentioned the percentage of Englishnen he would or three hundred, for example, in the refinery. With you, without saying why, he said he 'd changed his mind; he couldn't have any Englishmen at all. MR. NITZE: (?) Of course, that was an important point with the British. MR. ACHESON: Well, these discussions were--gave us some hope. They also brought out a very interesting thing which I think Averell's account has also brought out, which was his complete and absolute distrust of his own people. He was far more ready to be frank and free with us than he was with any on his own side. And during all the discussions which I had with him, and I think it is true of you two, he never had any Iranian with him at all. Not one, 0001644 not anybody. He wouldn't even have an interpreter; the interpreter was our