All oil companies received more blocks than law allows

Jun 23, 2019 News

ExxonMobil’s subsidiary, Esso Exploration and Production Guyana Limited, is not the only firm, which is holding way more blocks than the law allows. In fact, research conducted by this news agency indicates that almost all the oil companies holding an offshore prospecting licence were awarded, and continue to hold, way more blocks than they are legally entitled to.
Guyana’s oil laws state that oil companies are only allowed 60 blocks per licence, which is equivalent to 5073 km2. Attached to this article, is a graph showing how much each licensed holder offshore Guyana was granted.

When the Guyana-ExxonMobil PSA was first released, the size of the blocks awarded to the American multinational was a major issue of contention. The firm was awarded approximately more than six times what the law caters for.
Opposition Leader, Bharrat Jagdeo, has said that he has no apology to make for what his party did. He said there were special circumstances that justified such generous awards being made. The PPP General Secretary had told this newspaper that in 1999, when former President Janet Jagan awarded the PSA to Exxon to explore such a large concession, it was based on the challenges faced at the time to attract investors to explore the un-risked basin.
As for the current administration, which failed to correct this anomaly, it said that ExxonMobil was allowed to hold in excess of 60 blocks as it puts Guyana in a strategic position against its neighbour, Venezuela, which continues to stake a claim on Guyana’s territorial waters.
But transparency advocates locally and regionally lend no credence to the excuses made by the current and past administrations. Specifically, Transparency International Guyana Inc. (TIGI) states that the discretion conferred upon the Minister in the law to grant an oil company more than 60 blocks, should not be used to such an extent that the very Constitution, which calls for the fair and transparent award of the nation’s resources, is flagrantly breached or disrespected.

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