The founding of Montevideo drew the serious attention of the Rio government to the valuable country between the Plate and Santa Catharina. The Paulistas had thoroughly explored the plains and found them swarming with cattle. The chief obstacle to the foundation of a military post as a nucleus for the settlement of Rio Grande and eastern Uruguay was the lack of a harbour on that sandy coast. When the next European war broke out, in 1735, the Spaniards again besieged Colonia, and established forts and settlements along the Uruguayan coast, from Montevideo to the present Brazilian border. In 1737, the Portuguese authorities sent an expedition to take Montevideo, which failed. On the way back the Portuguese built a little fort at the only entrance which gives access to the great series of lagoons which run parallel to the coast for two hundred and fifty miles north of the southern Brazilian frontier. This is the site of the present city of Rio Grande do Sul. A few years later, a considerable number of settlers from the Azores Islands were introduced, who engaged in agriculture along the fertile borders of the great Duck Lagoon. [Illustration: RIO GRANDE DO SUL.] In 1750, Spain and Portugal made an attempt to reach an amicable and rational agreement about their South American boundaries. Up to that time, Spain had stubbornly claimed the territory as far north and east as Santos, and Portugal was even more unreasonable in asserting her exclusive right to the coast as far south and west as the mouth of the Uruguay. The treaty of 1750 virtually recognised the _uti possidetis_. Portugal agreed to give up Colonia, and the boundary to her possessions and those of Spain was drawn between the Spanish settlements in Uruguay and the Portuguese settlements in Rio Grande. The seven Jesuit missions in the interior, two hundred miles to the north, were abandoned by the Spanish government. Spain deliberately ceded these tens of thousands of peaceful and prosperous civilised Indians, and even agreed that her troops should assist the Portuguese in the cruel dispossession. The Indians fought desperately and unavailingly. But this iniquitous provision of the treaty was the only part of it which was ever carried into effect. Spanish public opinion protested, the boundary commissions could not agree, Portugal put off the surrender of Colonia on one pretext or another, and in 1761 the treaty fell to the ground and all the questions were left open.