Churchill, as a part of a three-year expansion program, sought to modernize Britain’s Royal Navy by abandoning the use of coal-fired steamships and adopting oil as fuel for its ships instead. Although Britain had large reserves of coal, oil had advantages in better energy density, allowing a longer steaming range for a ship of the same bunker capacity. Further, Churchill wanted to free Britain from its reliance on the Standard Oil and Royal Dutch-Shell oil companies. In exchange for secure oil supplies for its ships, the British government injected new capital into the company and in doing so, acquired a controlling interest in APOC. The contract that was set up between the British Government and APOC was to hold for 20 years. The British government also became a de facto hidden power behind the oil company.
