Latest update January 20th, 2025 4:00 AM
Kaieteur, Canje owners violated principle purpose of licenses; Guyana should recover – Chris Ram
– Companies sold blocks without doing any work
Kaieteur News – Attorney-at-Law, Christopher Ram has determined that the initial owners of the Canje and Kaieteur oil blocks reneged on the commitments they made to explore the blocks and, in doing so, violated the principle purpose of the agreements when they flipped the licenses without doing any work. He explained that this violation constitutes sufficient grounds for Guyana to recover the asset, and that Government should so do.
Anti-corruption advocate, Christopher Ram
Ratio Guyana (owned by Ratio Petroleum) and Cataleya Energy Limited (formerly Ratio Emergy) each sold 25 percent of their Kaieteur Block ownership to ExxonMobil in March 1, 2017. The transaction waited two years following their receipt of the license from former President, Donald Ramotar on April 28, 2015, during which the companies did no work. It was only until ExxonMobil became operator that it conducted a seismic survey two months into its ownership, and is currently drilling the Tanager-1 well.
As for the Canje Block, Mid-Atlantic Oil & Gas handed shares in the block to the Canadian JHI Associates on May 15, 2015 – just two months after it received the block from Ramotar. Neither of them did any work, save for JHI which claimed that it bought data on the basin. The two companies sold shares to ExxonMobil in February 2016, with ExxonMobil becoming operator later that year, then to Total SE in February 2018. The three companies which farmed in now owns 87.5 percent of the asset.
“It was a license to do exploration, not to flip the transaction.” Ram told Kaieteur News. “The government should move to recover it.”
Under the prospecting licenses, the initial owners committed to “have, or… acquire, the financial resources, the managerial, technical and industrial competence and the experience to carry out Petroleum Operations and will provide a guarantee” that they will observe the conditions of the license. Such a guarantee is required under Section 13 of the Petroleum (Exploration and Production) Act.
Kaieteur News has carried a sustained series of articles for several weeks, detailing the red flags which have occurred in the handling of these licenses. Yet, the government has remained silent on the matter, with former President Ramotar and Foreign Secretary (once Minister of Natural Resources) Robert Persaud opting not to explain why so many red flags have manifested in the handling of these licenses.
“It is disappointing that the administration seems willing to ignore those concerns.” Ram said.
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