Can Exxon be trusted?

Jul 01, 2017 Features / Columnists, Peeping Tom

Exxon Mobil holds all the cards in relation to its operations in Guyana. ExxonMobil controls the information flow out of the Stabroek block.
Guyana is just like a sponge absorbing all that ExxonMobil is saying and hoping that it is true. But Guyana has no way of knowing for sure because the Guyana government believes that ExxonMobil is honest, oh so honest with them.
It is good to have such faith. It is called blind faith and it has billions of adherents the world over.
Exxon knows that it has all the cards. And it will deal with those cards according to its own rules. Guyana is hoping that Exxon, as one of the largest multinationals in the world, will deal a fair hand. But even if they don’t, Guyana still does not lose because you cannot claim to have any entitlement to what you do not have.
Guyana is getting excited about oil but all it knows is what ExxonMobil tells it. ExxonMobil is the only one that knows whether there is oil or whether there is water in the wells that it has drilled.
ExxonMobil is the only one who knows the quality of that oil or the amount which exists below the sea bed. Guyana is simply accepting what Exxon Mobil is saying. It has no way of verifying anything that is said because it is that company which is drilling for the oil and which says that it has found oil.
The timing of ExxonMobil’s oil find in Guyana was most amazing. It was just a mere days before the general and regional elections of May 11. The PPPC thought it would have swung the elections in its favor. We do not know whether Exxon Mobil felt the same way. We have no way of knowing because Exxon Mobil holds all the cards. Only they knew, for sure, that they had struck oil.
The announcement had a striking resemblance to what Bosai did when it announced that it was going to build a smelter in Guyana and invest close to one billion dollars. It did work for the PPPC. But we do not know whether political calculations were involved in the decision of Exxon Mobil to announce that it has struck oil days before the 2015 elections even though it is hard pressed to explain why Exxon Mobil could not wait until after the elections to make that announcement.
It is strange that ExxonMobil has found oil and other companies have not. Perhaps they were not looking in the right place. But now that it is known that Exxon Mobil has struck oil in a particular location, how is it that other companies with concessions nearby are not in hot pursuit of drilling rights. Guyana does not know because Exxon Mobil has all the cards.
Exxon Mobil has quickly decided that it will make an investment in the Liza well. That decision came very quick so that assumption is that ExxonMobil feels confident about the amount of oil in that well.
But that is not how oil companies make investment decisions. They usually look at the long-term picture to see the reserves of the area in which they are operating. They should have been drilling more wells before committing the billions which they say they will be investing in the Liza well.
Guyana will try to comfort itself by saying that if the company was bluffing it would not be spending all that money. We do not know because Exxon Mobil holds all the cards.
What is sure is that ExxonMobil is so awash in money that tomorrow it can walk from any investment in Guyana and not in a cent poorer.
ExxonMobil holds all the cards. Guyana trusts ExxonMobil. Where there is trust there can be happiness. For the sake of all those Guyanese who feel that oil riches are on the horizon, let us hope that ExxonMobil can be trusted.

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