Govt. fails to publish ExxonMobil Bridging Deed

Jan 15, 2018 ExxonMobil, News

While the Government has released the ExxonMobil petroleum contract, there are still some key documents which it has failed to make public. This was recently pointed out by Chartered Accountant, Chris Ram.

Minister of Natural Resources, Raphael Trotman

Ram noted that the Government is still to release the Bridging Deed between Government and ExxonMobil. Ram outlined that the Petroleum contract makes mention of the “Bridging Deed.” The purpose of this Deed is to replace the 1999 Agreement and the 1999 Petroleum Prospecting Licence.
In his recent writings, the lawyer noted, “Readers will recall that then President Janet Jagan signed the 1999 Agreement in violation of the Petroleum Exploration and Production Act (the Act) to the extent that the company (Esso Exploration and Production Guyana Limited) was granted approximately six hundred blocks instead of the sixty blocks permitted by law.
“The 1999 Agreement and Prospecting Licence appears to have been contained in a single package and included a full description of the blocks and a map of the area allotted to the oil company. The 2016 Agreement merely states that on that date, Minister Trotman granted a Petroleum Prospecting Licence for an initial period of four years.”
Ram added, “In other words, the whole idea of Mr. Trotman was to pretend that the 1999 Agreement never existed. Trotman has to be given credit – this takes legal gymnastics to a completely new level.Trotman obviously decided to complete the concealment of the 2016 Agreement by failing to comply with section 16 (2) of the Act.”
Section 16(2) of the Petroleum Exploration and Production Act states: “The Minister, shall, as soon as may be practicable after a licence has been granted, cause notice of that fact to be published in the Gazette stating the name of the licensee and the situation of the land in respect of which the licence has been granted.”
The Attorney-at-law told Kaieteur News that Trotman failed to observe this aspect of the law, while commenting that it is a worrying precedence.
The auditor added, “Did Trotman decide that he could bypass the provisions of the legislation and do as he chose? Clearly he does not consider himself bound by any laws and free to violate them as he chooses.”
Ram also stated that a prospecting licence can only be granted on the basis of an application made in accordance with the Act. He said that the application must contain a whole range of information as prescribed by the Act and Regulations, including proposals for local content in terms of employment and the procurement of goods and services.
STAKE IN THE ENTITY

Chartered Accountant, Chris Ram

Ram also pointed out that Minister Trotman missed a glorious opportunity to apply the provision of Section 22 (2) of the Petroleum Exploration and Production Act to ensure that Guyana had a stake in the entity.
That subsection says, “There may be included in a petroleum prospecting licence provision with respect to the exercise by the State, or any agency thereof identified in the licence, of an option to acquire on stipulated terms, or on terms to be agreed, an interest in any venture for the production of petroleum which may be carried on in any block or blocks to which the licence relates.”
Ram said, “Imagine the leader of one of this country’s leading political parties deciding not to take up equity in companies exploiting a valuable, non-renewable resource. Trotman must surely know that the Government would not have had to pay upfront for its share of equity and could have elected to exercise a carrying interest.”

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