Disastrous oil deals for Guyana must be renegotiated – no retreat no surrender

Oct 09, 2020 Letters

DEAR EDITOR,

Kaieteur News – Regardless of which political party is in power, the obnoxious and detestable two percent contract between the Government of Guyana and Exxon’s subsidiary and its partners, is deemed to be un-negotiable by the government. Irrational and sad! As it is clear to anyone who is intent on negotiating a fair agreement for Guyana, basic common sense and a little courage is needed to repair the sell-out oil agreements, which corner and rip-off the oil resources belonging to the Guyanese people.
Renegotiate the contract for a Royalty of 15 percent, not retreat or surrender or put blinders on to avoid and hide from the disrespectful terms of an amputated and contemptible contract.
Using slippery jargon and promises to hoodwink the people of Guyana does not change the reprehensible terms contained in the Production Sharing Agreement/s. All the fanfare and twisting and untwisting of words will not change the underlying and fundamental problem with this parasitic contract, which sucks the livelihood out of our people, especially the poor and extremely poor.
A referendum is not needed to determine that the contract is disadvantageous and an embarrassment to Guyanese. Are we going global to determine whether two percent royalty is acceptable? Having such a referendum will only add insult to injury. It’s like having a referendum to decide if 33 is a majority of 65.
Exxon’s abuse of the Guyanese people with this punitive and wicked contract that was literally served on our subservient Cabinet members has not been overtaken by any positive developments for Exxon or Guyana. Instead, it seems the Exxon has received the Dutch Curse:- oil prices fell to record lows, Exxon reported record losses for January to June of 2020, the company has been removed from the Dow Jones Industrial Index of blue chip stocks after 90 plus years, Exxon’s share price is at record lows, with their market capitalization dropping from over US$300 billion in 2016 to less than $150 billion in 2020. In addition, COVID-19 is having a devastating impact on the company’s oil sales.
I recall writing an open letter to Exxon’s CEO, Darren Woods, appealing to his conscience to free Guyana from this ignoble contract (see March 5, 2018 edition of Stabroek News, Kaieteur News, Guyana Times and the Oil & Governance Network, among other publications). The publications carried varying captions: “Remaining Oil Blocks Should be Marketed only after Exxon Contract is Renegotiated/ExxonMobil Agreement Should be Renegotiated Before New Deals With Other Companies.” The letter among other statements, implored Exxon to give Guyana a fair deal, not the two percent pittance, grandly called a royalty.
An extract from the letter is still relevant: “We in Guyana, with a relatively small and poor population of between 750,000 and 800,000; now appeal for Exxon’s compassion, mercy and kindness to renegotiate the June 27, 2016 agreement, signed three days before Exxon’s June 30, 2016 announcement of 1.4 billion barrels of oil discovered at another Liza Well in the Stabroek Block. Whether, the representatives of Guyana knew of this 1.4 billion barrel find on that fateful day of June 27, 2016, when the Petroleum Agreement was signed, would undoubtedly have made no difference to the contents of the agreement, as our Government has defended the Petroleum Agreement; strenuously, hoarsely and ad nauseam. Mr. Darren Woods, Chairman and CEO of ExxonMobil, kindly heed the pleas and prayers of the Guyanese people.”We feel no pleasure in seeing Exxon sink from its decades of glory, let us rise together a with fair agreement, by freeing Guyana from this lynch like contract.

Nigel Hinds

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