“Mr. Five Percent”

25/04/2006 Kamo MAILYAN

In the 11th century, in the tenure of the Senekerim King of Vaspurakan the Rshtuni potentates moved to Kapadovkia city of Cesaria with their families. In that period they were given a title of “Vard Patrich”, which later they changed to the Gyulbenkyan surname. Galust Gyulbenkyan was born on March 23, 1869, in the family of Sargis Gyulbenkyan in Skyutar region of Constantinople. Galust Gyulbenkyan had two brothers. He got his elementary education at Aramyan-Unchyan school of Kar village community. He continued his education at Saint Hovsep College of France. With the purpose of improving his French he left for Marseille and then entered the “King’s College” of London to study architecture. Later Gyulbenkyan graduated from the Oxford University and was qualified as an oil producing engineer. Upon graduating from Oxford, Gyulbenkyan was given a prize in the “First” nomination for his excellent studies. In 1892 Gyulbenkyan married Nvard Esayan in London. In 1892 they had a boy named Nubar-Sargis, and in 1900 – a girl named Rita-Sirvard.

Much is spoken about the richness of Gyulbenkyan, but most of them don’t know what kind of difficulties Gyulbenkyan had to overcome to reach the status of oil baron. In 1981 Gyulbenkyan published a book entitled “La Transcaucasie et la Peninsule d’Apcheron-Souvenirs de Voyage”, as well as articles in “Revue de Deux Mondes” newspaper in France. The mining minister of Ottoman Turkey liked those articles and asked Gyulbenkyan to prepare an informational book about the oil mines in Turkey and the Middle East. In 1898 Gyulbenkyan was appointed as advisor on economical issues to the Turkish Embassies in Paris and London. This position and the British citizenship helped Gyulbenkyan to strengthen his positions in London, in Europe and Turkey. In that period oil production was developing rapidly and before the US and Europe would be interested in the oil of the Middle East, Gyulbenkyan saw perspective development of this field and started his activities in oil production.

Gyulbenkyan started negotiating with the famous companies and businessmen of those times and took part in the founding works of the Royal Dutch-Shell Group. The Turkish revolution of 1908-1909 didn’t affect him due to his good positions and status in Europe. Gyulbenkyan kept his positions as advisor to the Turkish Embassies in London and Paris, he was appointed an advisor to the national treasury council of Turkey founded in 1910. With the purpose of cutting down the share of Germany in the oil market of the Middle East Gyulbenkyan recommended founding a Turkish company, which was founded later in 1912 and was named Turkish Petroleum Company (T.P.C.). The proportion of the share in this company was the following: Royal Dutch-Shell – 25%, Turkish national treasury – 35%, Galust Gyulbenkyan -15% and Germany – 25%. Very soon the company had to compete with the Anglo-Persian Oil Company, which was supported by the Foreign Office. They wanted the T.P.C. to sell the share of the Turkish treasury council to the Anglo-Persian Oil Company and Foreign Office. Later in 1913-1914 the oil companies organized meetings, as a result of which the share T.P.C. was reorganized and its incomes were distributed between the Anglo-Persian Oil Company, Royal Dutch-Shell Group and Germany, as for Gyulbenkyan’s share, he was given only five percent instead of the 15 that he had. WWI changed the situation in the oil business too. In that period Gyulbenkyan founded an oil company named it Comite General de Petrol, the purpose of which was to buy the stocks of the Deutsche Bank. After WWI, the T.P.C. was renamed Iraq Petroleum Co. LTD and the stocks of the former T.P.C. were distributed between the Anglo-Persian Oil Company (the current British Petroleum), the Royal Dutch-Shell Group, Compagnie Francaise des Petroles and Near East Development Corporation companies. Gyulbenkyan’s share in the Iraq Petroleum Co. LTD was five percent, due to which he was given his nick name “Mr. Five Percent”. The mentioned agreement was called “red line”.

After WWII, Americans started to enter the Arabian oil field with the help of the Arabian American Oil Company (Aramco) by violating the agreement of 1928. The parties started leading negotiations and later in 1948 the “red line” agreement was dissolved and was no longer in effect. After WWI, when in the Western Armenia Turks had perpetrated the Armenian Genocide and when Eastern Armenia was in the process of developing its state, the winning countries were negotiating in Europe. The “People and their works” book of those times wrote about the activities of Gyulbenkyan and his role in that period. We wonder why the authors of the book didn’t want to write about Gyulbenkyan’s meetings in the Councils of Sevres and Lozano. It writes briefly about Gyulbenkyan’s resignation from the position of Armenian Charity General Union (1930-1932). Armenian writer Karlen Dallakyan wrote about this resignation in his book called “About the resignation of the president of Armenian Charity Union Galust Gyulbenkyan”, where he combined the activities of Gyulbenkyan with the political developments of those times and concluded that Gyulbenkyan didn’t understand what kind of policy was being carried out by the Turkish Government of those times, otherwise he wouldn’t resign so easily after absurd insults by critics.

This resignation was surprising for Turks too. It is not clear yet whether there was anything common between the pressure on the Lozano and Sevr negotiations and expatriating Armenians to Syria, but it is clear that most of the Armenian human and political capacities didn’t orient well and didn’t use the power of Gyulbenkyan to protect themselves.

The Turkish government of those times knew very well about the diplomatic skills of Gyulbenkyan, about his contacts and good position in Europe and East, and as well as knew that being the head of the Armenian Charity Union he would do his best to protect the moral and religious existence of Armenians and would support them by all means to protect their right in Turkey. In June, 1932, the board of the Armenian Charity Union had to accept the resignation application of Gyulbenkyan. But even after his resignation Gyulbenkyan said that he would continue his charities and would support Armenians by all means. He provided financial support to build Armenian schools, hospitals in Lebanon, Turkey, Syria, Iraq, Jordan, as well as Armenian Churches in Middle East countries, Iraq, Lebanon and anywhere there were many Armenians. There are Churches built with his help in Baghdad, Tripol and Girkuk. In 1929 Gyulbenkyan provided financial support to build the well known library of the Patriarchy of Jerusalem, as well as fixed a monthly sum to be given to the Patriarchy, which was continued later after his death too. In 1922 Gyulbenkyan provided financial support to build the Saint Sargis Church in London, as well as provided $400.000 to reconstruct the Mayr Ator Surb Echmiadzin Church. Gyulbenkyan provided financial support to build the Nubarashen and New Cesaria community districts of Yerevan. In spite of all these charities Gyulbenkyan was not able to use his power and support Armenians after his resignation from the Armenian Charity Union. One of the other reasons for this was WWII. When most part of France was capitulated and occupied already Gyulbenkyan faced a real danger because at the time he was living in Paris. Taking into account the situation at hand, in April, 1942, Gyulbenkyan got an invitation from the Embassy of Portugal and left for Portugal to rest there for one week. But later after he visited Portugal he decided to spend the rest of his life there. He lived in Portugal for 13 years and died on July 20, 1955, at the age of 86.

“Galust Gyulbenkyan” foundation

Gyulbenkyan founded a charity foundation with the purpose of implementing charity programs all over the world. The foundation inherited not only the income from oil, but also Gyulbenkyan’s arts collection, for which a museum was founded after Galust Gyulbenkyan in Lisbon in 1969. There are numerous rare pieces of art in this museum. Currently this museum is considered to be one of the best rare museums of this type. The library of the foundation is also located in this museum with over 125.000 books. The foundation also has an arts service, which helps publish different analysis, historical and other works, as well as provides financial aid for musicians and other similar activities. The science academy after Gyulbenkyan in Oiras city of Portugal implements different scientific programs. There is an arts center named after Gyulbenkyan in Paris located in Gyulbenkyan’s apartment on Leana street- the Centre Culturel Calouste Gulbenkyan has been implementing different educational, scientific, musical and other programs since 1968, and there is even a library named after him, which is open to the public.

The purpose of the “Galust Gyulbenkyan” foundation is to provide financial support for scientific, educational, artistic, health and charity programs. Currently the mentioned foundation implements programs in 70-75 countries around the globe.

Department of Armenian Communities

A separate Armenian department was founded within the “Galust Gyulbenkyan” foundation and most of the budget is used to implement programs in Armenian communities in more than 27 countries of the world. The annual budget of the Armenian department covers about $3.600.000, providing financial support for scientific, educational, health and arts organizations in Armenia and Armenian Diaspora.

The mentioned department is mainly aimed towards implementing projects for the Armenian national educational and arts centers in Syria, Lebanon and Turkey. The foundation also finances the Armenian Diaspora in France, Greece, Italy and South America. The foundation has given much financial aid to the Matenadaran, the National Library of Armenia and the State University of Yerevan. Besides financing the program being implemented by the Armenian department of the foundation in 1988-1989, in 1988 the foundation gave an extra one million dollars aid to Armenia after the earthquake of 1988.