29th of the Iranian month of Esfand corresponding with March 20 reminds a considerable event in Iran’s history: The Oil Nationalization Day.”

It is a turning point in the history of Iranians’ struggle against the British colonial dominance over Iran’s oil.

Iran’s oil was first exploited under the supervision of George Bernard Reynolds in Masjed Soleiman in southern Iran and the Britons were very happy when they saw oil gushing out from the ground.

Oil exploration led to the signing of William Knox D’Arcy Contract which determined the fate of Iran’s oil. Based on the contract, Britain ruled over the excavation and production of Hydrocarbon resources of Iran, but it was pretended that the principle of 50-50 interests was observed. The same method was enforced in most Middle East states.

The record of Iran’s oil contracts dates back to 1870. At that time Naser-ud-Din Shah granted the concession of exploitation of Iran’s oil reserves to Baron Julius de Reuter for 70 years. As per article 11 of the contract, oil like other minerals such as coal, iron, copper and lead was considered an ordinary commodity.

In 1902, Mozzafar-ud-Din Shah granted the concession of exploration, excavation, exploitation and sale of oil of the country, except 5 northern regions of Azerbaijan, Gilan, Mazandaran, Gorgan and Khorasan, to the British William Knox D’Arcy for 60 years.

According to article 10 of D’Arcy contract, Anglo-Iranian Oil Company had to pay about 16 percent of oil net profits as the right of concession to Iran’s government, but the Britons refused to pay even this insignificant sum and since the start of Anglo-Iranian Oil Company’s activity, there was always a dispute over the calculation of the net profit and concession right.

After the occupation of Iran by Britain, the Soviet Union and the US, rivalry of colonialists intensified especially over oil; but the British government held talks with the Iranian officials to sign an accord and thus the 1933 contract was approved.

Annexation to 1933 accord caused serious protests of some religious leaders and people’s representatives. Ayatollah Kashani issued a strong-worded statement against the oil company in which he called for lifting its concession in Iran.

Despite all plots in Iranian history, efforts of people and some of the lawmakers for nationalizing oil industry led to cancelation of 1933 accord and on Esfand 29, 1329 of the Iranian Calendar corresponding with March 1951, the bill on Iran’s oil nationalization was ratified by the parliament.

Iran’s oil industry nationalization meant that all oil exploration, excavation and exploitation operations were put at the hand of the Iranian government. When Dr. Mohammad Mosaddeq became premier in April 1951, implementation of oil nationalization’s bill topped the government’s agenda. With the approval of this bill, the former Anglo-Iranian Oil Company lost its dominance over Iran’s oil.

Although this incident was a great victory for the Iranian nation, it meant losing a big part of their illegitimate colonial dominance for the British. They feared that other nations would take the model. Yet nationalization of Iran’s oil industry did not end the plots. Indeed London came to the conclusion that the only option for stopping the course of events was omit Mosaddeq; so a coup was planned by the CIA and its British counterpart MI6. The first phase of the coup failed and Shah escaped, but on August 1953, Mosaddeq government was overthrown and Shah was reinstated.

One year after the shameful 1953 coup, a contract was inked with a consortium consisting of 16 European and American companies and oil export started by those companies and the bill of oil nationalization was practically ignored. Then, companies including British Petroleum Company Ltd, Shell Petroleum NV, Gulf Oil Corporation, Mobile Oil Corporation, Standard Oil Company O-California, Texaco Incorporated and Company France-Z Petrol began looting Iran’s oil and formed a new consortium.

The companies known as Erikan group annexed the consortium in April, 1965. Members of the Iranian Oil Consortium set up two companies called “Iranian Oil Exploration and Production Company” and “Iranian Oil Refinery Company” which were together named Iranian Oil Operating Companies.