William Knox D’Arcy was born in Devonshire England in 1849 and, with his family, in 1866 migrated to Australia where his father set up practice as a solicitor in Rockhampton. Upon completing his Articles in 1872 D’Arcy was admitted as a solicitor and in 1882 joined a syndicate to develop leases owned by the Morgan brothers at Mount Morgan.
Due to Morgan’s growing concerns that the initially rich mine would deteriorate, they gradually sold their interests. Whereas Frederic Morgan believed that the gold had a shallow bottom, D’Arcy believed it was bottomless.
In 1886, Mount Morgan Gold Mining Limited with a capital of one million one pound shares was floated on the Stock Exchange in Sydney. D’Arcy relentlessly purchased shares until he owned 36% of the company which operated as one of the richest gold mines in the world.
Supported by a rich dividend stream and the sale of some of his shares, D’Arcy, then extremely wealthy, returned to England in 1887 where he lived a lavish lifestyle.
By 1900 D’Arcy’s wealth was affected by the rapid decline both of the dividends and value of the Mount Morgan shares. He thus sought to reconsolidate his financial position through investing in a new mining venture.
As D’Arcy saw that oil would be a crucial commodity, he sent representatives to Persia to assess the prospects of finding oil and to negotiate a potential concession. In 1901 an agreement was reached with the Shah of Persia giving D’Arcy exclusive rights for 60 years to mine exploit and sell natural gas, petroleum, asphalt and mineral waxes over nearly three quarters of Persia. In return, the Shah received 20 thousand pounds cash, shares valued at sixteen percent of the annual net profits from the companies operating the concession.
After initial disappointments and with the financial assistance of the Burmah Oil Company of Britain, D’Arcy’s team finally discovered oil in 1908. In order to work the concession, the Anglo-Persian Oil Company which later became British Petroleum was formed. Britain’s success in both the First World War and, more particularly, in the Second World War, has been attributed substantially to its access to ample supplies of oil.
Distinguished Australian historian Professor Geoffrey Blainey AC describes William Knox D’Arcy as the most remarkable of all Australian business stories because of his involvement in two such profoundly successful ventures on opposite sides of the world but more importantly for his role in the discovery of oil in the Middle East and the impact this has had on business and political history to this day.