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Announcement of Liza-2 find, one day after contract signing, shows ExxonMobil’s dishonesty – Chris Ram
ExxonMobil’s announcement of a world class oil discovery just one day after the Government awarded the 2016 Stabroek licence to it, shows that the oil company acted deceitfully and dishonestly.
Attorney-at-Law, Christopher Ram
That is the remit attorney-at-law, Christopher Ram, shared in the Thursday edition of his Stabroek News Column ‘The road to first oil’.
The lawyer, in describing the circumstances surrounding the controversial award, stated, “Nothing… shows Exxon’s bad faith more than its announcement of a major find, one day after the Granger Government awarded them a tainted Petroleum Agreement made possible by the infamous Bridging Deed. It is either trickery or conspiracy.”
The agreement was signed on June 27, 2016. The Bridging Deed, which sought to link it to what would be a “dead” 1999 agreement, was signed on June 29, 2016. The world class Liza-2 discovery was announced by ExxonMobil, the next day, with an estimation of at least 800 million oil-equivalent barrels.
Ram’s comment comes after a report published by globally respected anti-corruption watchdog, Global Witness, revealed that ExxonMobil and Minister of Natural Resources, Raphael Trotman, knew of the second discovery in the Liza field.
It reported not only that, but that Trotman failed to capitalise on Guyana’s strong negotiating position by waiting for the details of a find he knew Exxon was analysing.
Global Witness found that Trotman even knew the company would announce its results on a specific day. Had he waited, the Minister would have been able to bargain that he represented a country with ownership of one of the world’s largest recent finds.
While this would indicate that Trotman’s hurried negotiation would place him solely at fault for failure to capitalise on Guyana’s strong bargaining position, another report buttresses Ram’s assertion, and shows that both parties had a hand in maintaining Guyana’s disadvantage.
The British law firm, Clyde and Co, was hired by Government to conduct an investigation and report on the circumstances surrounding the contract signing.
That firm found it likely that ExxonMobil’s subsidiary, Esso Exploration and Production Guyana Limited (EEPGL) and its partners, Hess and CNOOC, pressed the Ministry of Natural Resources to get the new agreement signed prior to their formal announcement of the results of the Liza-2.
It stated that ExxonMobil probably feared a change in Government’s negotiation strategy, resulting from knowledge of the discovery’s “world class” nature. That, and a reason given by ExxonMobil, that it needed to step aside from rig commitments if no new agreement was signed.
The hurried signing of the 2016 contract is one of major reasons in public discourse about why the terms of the contract placed Guyana at such a purportedly severe disadvantage.
That, and the fact that, according to Clyde and Co, securing better terms for Guyana just wasn’t a priority for the Government. It was more focused on ensuring the continuity of its relationship with the Exxon-led consortium.
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