WHAT IF…?

Aug 06, 2015 Features / Columnists, Peeping Tom

Days before the May 11 elections in Guyana, the news broke that ExxonMobil had discovered a significant petroleum find in Guyana’s waters. This was music to the ears of the supporters of the PPPC; it meant that Guyana would soon be rich thanks to the investment made on petroleum exploration by the government.

The supporters of the opposition APNU+AFC also reacted. They said it was a propaganda ploy intended to enhance the fortunes of the ruling party. It was in their estimation an election gimmick.

That announcement did not cause the PPPC to win the election. It narrowly lost those elections to the APNU+AFC coalition which now inherits this claim to an oil-find in Guyana’s waters.

The new government has been enthusiastic about the oil find. It is not questioning it. It has accepted what its supporters had originally denied. It has accepted that there is indeed oil in the waters in the Stabroek Block.

But how is the government to be sure that what it is being told is true? Does the government have any experts in this area that would have studied the findings by ExxonMobil? Or is the government prepared to accept the word of a powerful multinational corporation? And is it accepting this word simply because it comes from an American company?

In other words, how is the government to know for sure that what it is being told is credible and accurate?

What if it is not true? What if the Americans are up to their dirty tricks and are playing the government of Guyana in order to stir trouble with Venezuela? What if this so-called discovery of oil is just a ploy by the Americans to promote problems between Guyana and Venezuela so as to pursue American geo-strategic objectives?

I am not saying that it is. All I am saying is that Guyana has to consider all angles of this issue. And in order to rule out being used as a geo-political pawn, Guyana has to ensure that there is indeed evidence to suggest that there is a discovery of oil in significant quantities.

How is Guyana going to do this? I do not know. But what I do know is that if indeed ExxonMobil has stumbled on an oil find, then others may eventually do the same. If Guyana is it to be in position to get the best deal from these companies, it has to have the ability to be able to verify what these companies are saying. It has to have its petroleum experts to advise it, because it is important that there is a system to verify whatever a multinational says to the government.

Guyana is hopping happy over the oil find. But should we? Will oil be a blessing or will it be a curse? Oil has brought untold riches to many countries. But it has also created problems. These countries have become materialistic; their peoples are accustomed to high subsidies and to having almost all social services free. Oil-producing countries often have to import labour because their people do not want to work, and when they do, they only work for a short period and they demand a lot of money. Oil may be good in one way, but it may be bad in another.

The other frightening question is the threat that Guyana could face from Venezuela if indeed there are significant reserves of oil. That country is going to feel that Guyana can take away its market in the United States, which is the largest buyer of oil from Venezuela. This is a factor that has to be considered. If it were a Chinese company that found the oil, then perhaps the oil could have been sold to that market. But ExxonMobil is an American company, and one that is not liked by the Venezuelan government. So if we do find oil, a great deal of that oil money may end up having to be spent in establishing a stronger military.

These are all things that need to be considered in the debate as to whether the discovery of oil is a blessing or a humbug. If there is oil, then no one should deny the Guyanese people the right to the riches that will flow from it. But Guyana has to look at the experience of other countries and ensure that it does not make the same mistakes those countries made.

Before Guyana begins to plan for a future that involves oil wealth, it should first establish if indeed there is oil; how many barrels there are likely to be, and what it will take to get the best deal for the exploitation of these resources.

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