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All political sides are not being realistic with Guyana’s Fossil Fuel Industry’s future
Dear Editor
I have come to the conclusion that none of the major political parties in Guyana have any sort of comprehensive long term plans for Guyana’s Energy Future. The Deal with ExxonMobil is more or less a quick money without a long term economic plan for our place in this industry venture and if you don’t have plan this will quickly cave in on us.
The ExxonMobil deals compared to what other countries have is leaving us little room for real gains from the projects scale. While a 52% share may seem like a good deal now, wait until the price of oil plummets again and it is very likely to happen again.
That will be the factor that makes or breaks a very costly investment and we as the citizens and tax payers will face the burden.
The Fossil Fuel industry has been in a lot of uncertainty and instability for the last 10 years. The ever-growing push for more environmental friendly alternatives to Fossil Fuels like Solar and Wind energy has been taking the Global stage where many countries are starting to adopt them as replacements to traditional Oil and Gas.
Now I am not going to be this basher of ExxonMobil’s corporate structure and wheeling and dealings. I feel any person will simply find that out on his own. From back room deals with the Russian Oligarch or drilling in the Kara Sea while Russia is under US Sanctions and to the Exxon Valdez spill that this hasn’t been corrected since and the list can go on.
ExxonMobil has a pretty disastrous record and the Guyana Government is still sitting quietly with them.
I propose we adopt the Scandinavian model for our Oil and gas Sector, primarily what is done in Norway–a mix of a nationalised oil industry with contractual agreements on the drilling and extraction and production of fuel being left to private enterprise with government having the stronger oversight and regulation of the industry.
Norway took their Oil and Gas profits and made a Heritage fund, which is now worth over US$1 trillion for their citizens to have direct access to the money made from their oil and gas sector. Each Norwegian citizen is allowed US$192,000 each year cap allowance from the fund and the freedom to use that money as they please.
Oil is taxed at rates of up to 78%. Norway established its oil fund in the 1990s as a way of protecting the economy from instability in the price of oil, and as a way of saving up for the day the oil runs dry and for moving to a greener future without Fossil Fuel.
This is the way we should be moving as Guyana establishes its place in the Global Fossil Fuel industry.
Respectfully yours
A.Singh
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