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Jagdeo single-handedly dictates Guyana’s depletion policy to be “drill baby drill!”
In absence of nation-wide consultation…
By Kiana Wilburg
Vice President, Dr. Bharrat Jagdeo
Kaieteur News – When the People’s Progressive Party/ Civic (PPP/C) assumed office about five months ago, Kaieteur News had published a list of 20 things, which the new government must do to set the oil industry on the right path; a path that would allow the nation to build its capabilities to properly govern and monetize the resources. High on that list was the creation of a depletion policy.
In simple terms, this strategy would say how fast or slow Guyana must extract its oil resources.
Several local, regional and international stakeholders have appealed for the nation to have a policy that slows the aggressive rate of extraction by ExxonMobil; otherwise, the country would be left extremely overwhelmed and on a dangerous precipice.
Taking this into account, Vice President, Dr. Bharrat Jagdeo was asked in November 2020, during one of his press conferences, to state the government’s interest in implementing a policy that would slow the rate of extraction.
At that time, the Vice President did not give any commitment or guarantee that the government would be inclined to walk that route. Dr. Jagdeo did state, however, that his personal view is that there should be aggressive oil production. (See link: https://www.kaieteurnewsonline.com/2020/11/14/jagdeo-in-favour-of-aggressive-production-of-guyanas-oil/)
Weeks later, Guyanese, who have yet to be consulted on this critical matter, would learn that Jagdeo’s personal position has become the bedrock of what the PPP/C’s depletion policy for the nation would be. That policy for the time being says –“Drill baby drill!”
During an interview on Kaieteur Radio on December 23, 2020, the official said that Kaieteur News has often reported that the PPP/C is yet to define a depletion policy. He stressed, however, that the government has already done so “anecdotally.”
The Vice President said, “My own view is that we have a period in which oil would still be very relevant in the global mix of energy and we have a period but it is a window that is closing because of climate change. The window for Guyana will be open a little longer for us than other countries because we have low breakeven costs and because our crude is sweet, light unlike others which have heavy or sour crude.”
The Vice President also noted that the recently issued regulations by the International Maritime Organization require the removal of 80 percent of the sulphur content from global shipping. Since heavy or heavy sour oil has a lot of sulphur, “everyone is looking for sweet crude now.”
Further to this, Jagdeo pointed to the fact that the world’s leading economies, China and the USA, have made it pellucid that they will be heading to renewable. In fact, China, the world’s biggest energy consumer, aims to achieve carbon-neutrality before 2060. As for the USA, President-elect Joe Biden has declared intentions to increase the nation’s switch to renewable energy.
Considering the implications of climate change and the global transition to cleaner energy sources, Jagdeo posited that demand for fossil fuel is either going to be static or declining in 15 to 20 years’ time. He said that this is what has influenced the PPP/C’s position to extract the oil as quickly as possible, use portions of it to build world class infrastructure and education while putting aside some for inter-generational equity.
“That is the depletion policy for you,” the Vice President concluded. (See link: depletion policy time stamp: (1: 05: 26) https://www.youtube.com/watch?v=WA03jUwgIDY)
Origin of the phrase –“Drill, baby, drill!”
“Drill, baby, drill!” was a Republican campaign slogan first used at the US 2008 Republican National Convention by former Maryland Lieutenant Governor Michael Steele, who was later elected Chairman of the Republican National Committee. The slogan expressed support for increased drilling for petroleum and gas as sources of additional energy and gained further prominence after it was used by Republican Vice Presidential nominee Sarah Palin during the vice-presidential debate.
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