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Who is in bed with Exxon?
Nov 15, 2020 Front Page Comment, News
Kaieteur News – In 2018, the IDB approved a US$11.6M (GY$2.55B) loan to help Guyana police its oil reserves. The loan agreement was signed with the understanding that Guyana needed time to build capacity and knowledge and to implement robust production controls to maximize oil returns.
Oil companies race to maximize output by aggressively emptying discovered oil reservoirs. They maximize production to maximize profits. For the oil companies, the host country must live with that, even if it means much lower oil revenues
From Guyana’s perspective, it is better to go slower in order to learn the ins and outs about the finer points of our oil riches, and get the most of it. Time allows for the recruiting of trusted experts and the fostering of confidence in what we are doing, because the country would have accumulated the right people and knowledge. Our leaders can then dictate the terms and pace of extraction.
However, the previous governing APNU Coalition showed scant interest in pursuing such an approach. And, today, Guyana’s de facto Oil Minister, Vice President Bharrat Jagdeo, cannot give the straight answer on the issue of a depletion policy.
He should familiarize himself with the terms and conditions of the IDB loan. Whether the loan calls for such a policy or not is irrelevant. What is important is that we slowdown production and position ourselves to dictate the rate of extraction in order to obtain the most from our oil wealth.
This cannot be so difficult for Oil Minister, Jagdeo to understand. So, why is both he and the Coalition so casual and complacent about a depletion policy? Who was and who is in bed with Exxon?
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