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Guyana’s oil blocks on US markets

Dec 06, 2020 Editorial

Kaieteur News – It was just a matter of picking the right spot and time, but there it is. More accurately, there they are, which would be the Canje and Kaieteur Oil Blocks, long riddled in secrecy and controversy in Guyana. As announced to the world in the trumpeting SN headline of December 4, “UK firm throws shares in Kaieteur, Canje Oil Blocks on US, UK stock markets” there are a few things for the ordinary Guyanese, not familiar with these kinds of things, to understand.
Shares for the two Guyanese oil blocks, through Westmount Energy Limited are now listed in the United States on something called the OTCQB. It is not what mesmerizes outsiders via high-energy, high-flying markets that attract television coverage, where a controlled frenzy is part of the madness. The OTCQB is where highly speculative issues can be found and traded; the disclosure requirements are not as stringent and probing as the wider Over-The-Counter (OTC) Market, or the ‘Big Board’ New York Stock Exchange, which is globally known and recognized.
In addition to speculative securities and other generally low-priced issues, shares of shell companies can be traded on the OTCQB. As has been made repeatedly and abundantly clear, by frequent breaking disclosures from KN, the arrangements and handovers of both the Canje and Kaieteur Oil Blocks possess all the characteristics of what is generally recognized as occurring under the umbrella of shell companies.
There are ongoing questions and suspicions in this country about government’s authorization for the transfer of beneficial ownership relative to significant portions of those oil blocks by the original recipients. At present, the previous coalition government has evaded answering any questions or has indicated any willingness at providing any information. The current Guyana government has also been most reluctant to furnish any details, and appears to be largely on the defensive, as though there is much to hide. Secrecy and silence have been the byproducts and are what have governed the origins of the giveaways (or supposed sale) of the Canje and Kaieteur Oil Blocks. It would be an understatement to state that all of this has been hotly pursued, sharply challenged, and closely watched on the Guyanese front.
At any time, some concerned conscientious Guyanese citizen or group of citizens could decide to challenge not the listing itself, but the circumstances surrounding the initial movement of the blocks under the auspices of the pre-2015 government of Guyana, as well as the documented basis for the later sale and transfer(s) from those shadowy partners to other more mainstream presences, such as Exxon and Westmount Energy Limited. After all, from currently available information, both blocks are reported to contain billions of barrels of oil or oil equivalents. Because the future of Guyana and its children for generations to come is closely linked to our oil prospects, and the proper handling of those, there can be developments that jeopardize investments in shares of these oil blocks.
Against this backdrop, Guyana’s oil blocks ready for trading in the OTCQB. It is the market for thinly traded issues (illiquid), generally cheaply available ones (‘penny stocks’), dark companies (those that do not qualify for the more reputable market channels). Shares of such companies are best dabbled into by sophisticated investors. That is, those who know what they are doing and can afford to absorb the anxieties of trading halts, zero market maker interest, and the related financial losses that are part and parcel of this level of market. To put differently, investors, among which are sure to be any number of Guyanese, must understand and weigh the risks involved versus the potential rewards of putting their hard earned money in Guyanese oil, in what could turn out to be laden with disappointment.
There should be no mistake: the oil is present and plentiful. It is just that the way one government after another has operated with this national wealth in a manner that leaves so much to be desired, so much that reeks of the wrong. We should have been excited. Instead, we are worried that naïve Guyanese will lose their shirt in pursuit of a big killing, which their political leaders could likely enjoy with this stock listing development.

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