Any contract can be renegotiated – GRA Boss

Feb 03, 2020 News

“Any contract that you have is not written in stone.”

GRA’s Commissioner-General, Godfrey Statia

That was the response given by Commissioner General of the Guyana Revenue Authority (GRA), Godfrey Statia, when asked whether the controversial ExxonMobil deal can be renegotiated.
Statia made this and other comments during a press conference at the tax agency’s Camp street office, last Friday.
The tax boss faced questions from reporters about the permanent tax holiday granted by Government to ExxonMobil and its partners, Hess and CNOOC, for their Stabroek Block operations.
The Government had agreed that Guyana would pay out of its share of oil revenues, the taxes of the three oil companies with stakes in the Stabroek Block.
During that discussion, Statia posited that the situation will not change unless the Production Sharing Agreement (PSA) is changed.
He also said that one would have the right to renegotiate a contract if the circumstances under which the contract was originally signed have changed.
Asked if that is possible for Guyana, he responded “Everything is possible.”
He explained that “every country” at some point has renegotiated its oil/gas contract.
“Every one of them!”
The tax chief’s comments bear similarity to those made by Trinidad & Tobago Prime Minister Keith Rowley in 2018, who said “There’s a role for the government in ensuring that the people of Trinidad and Tobago, while being participants in this very lucrative business, get more than crumbs that fall off the table”.
Trinidad & Tobago has since gone on to renegotiate several contracts with oil & gas companies it does business with. Statia’s comments are also given credence by Papua New Guinea’s experience with ExxonMobil.
The oil major’s gas project with the nation was described in a report as parasitic, because it turned out to leave the nation worse off than it was.
Learning from its mistake, the Government of Papua New Guinea sought to get better terms.
Even recently, in discussions with ExxonMobil on the expansion of the gas project, the Papua New Guinea Government scrapped the talks because the company continued to offer unfavourable terms.
Kaieteur News reported last month how that project beared several similarities to Guyana’s case. (https://kaieteurnewsonline.com/2020/01/05/exxons-parasitic-project-in-papua-new-guinea-bears-similarities-to-guyana/)
In Guyana’s case, Government has been beckoned for years by several sections of the public to renegotiate the Stabroek PSA, described as lopsided and unfair. The Papua New Guinea experience underscored the need to release all economic models, a report stated. Guyana has been urged to do the same by Former Petroleum Advisor to the President, Dr. Jan Mangal. But, even that, Government will not do.

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