Latest update February 25th, 2025 10:18 AM
Latest News
- Five dead in road accidents
- 25 helicopter trips required weekly for preparatory work on 7th oil project—Exxon says in EIA
- Israel deploys tanks as assault on occupied West Bank intensifies
- Govt. seeking contractors for $1.9B Parika to Goshen Road project
- GHRA urges Gov’t to follow laws in dealing with US deportation issue
Jagdeo’s revelations on depletion policy unbelievable and troubling – Ram
Kaieteur News-“Unbelievable and troubling” — that is how chartered accountant and attorney-at-Law, Christopher Ram has chosen to describe the recent announcement by Vice President, Dr. Bharrat Jagdeo of Guyana’s depletion policy for petroleum extraction in the millions and millions of acres being operated by Exxon’s offshore subsidiary in the Stabroek Block.
According to Ram, the policy announced by Mr. Jagdeo amounts to no policy – just explore and extract as much as possible within the shortest possible time. He is of the view that this announcement, which was made during a radio interview, outside of a more formal announcement which such an issue warrants, must be music to the ears of ExxonMobil which sees Guyana as its redeeming cash cow.
Ram said that prior to the 2020 elections, he had reason to believe that a PPP/C Government would take a stand on the egregious and in some parts unlawful Petroleum Agreement signed by former Minister Raphael Trotman one full year after a world class discovery offshore Guyana. He now thinks that on an objective assessment, the PPP/C appears to have decided to leave matters well alone and worse, giving ExxonMobil even more than it has asked for, such as the rushed Payara production licence with no meaningful conditions attached, the kid gloves treatment of Exxon over its flaring, and the removal of the highly qualified Dr. Vincent Adams, who was becoming a thorn in Exxon’s flesh, from the Environmental Protection Agency.
Noting that it might be purely coincidental, Ram drew attention to 17 notices by the Maritime Administration Department of the Government in yesterday’s newspapers, only some of which include the area size of the operations. These notices advise mariners of continuing Deep Water Development operations in Liza Field within the Stabroek and the Canje Block, to run for the whole of 2021.
Christopher Ram
Further to this, Ram noted that Article 5 of the Exxon’s Petroleum Agreement provides for relinquishment of part of the area after the end of the first renewal period and the signal to Exxon of the unrestricted exploration and extraction policy can have on the effect of forestalling any meaningful relinquishment by Exxon when the time for such relinquishment comes around. The accountant who also holds a post-graduate degree in Oil and Gas notes, that while it was under then Natural Resources Minister Robert Persaud, who is now back in the Government, that the Model Petroleum Agreement was made more attractive than the 1999 Agreement to Exxon granted by the late President Mrs. Janet Jagan. Mr. Trotman then exploited and abused this relaxation to the hilt – all in Exxon’s favour.
Ram said that while Jagdeo is an economist by training, many energy economists will have fundamental disagreement with the logic and rationale for the absence of any depletion policy. While fossil fuel use is coming under increasing pressure, coal will go long before petroleum and that there is no economic logic for running down our premium quality petroleum resources. Ram also pointed out that the newly announced policy will de-optimise local content and gave the example of Omai Gold Mines Limited which took around five years to achieve its local content targets within a mandatory agreement involving a comparably miniscule geographical area and activity.
Ram said that the PPP/C may not have paid enough attention to oil and gas between 2015 and 2020 and suggested that the Government now reflect on the need for a comprehensive Petroleum Policy having regard to Article 149 J of the Constitution, the limitations of the Petroleum Exploration and Production Act and regulations, local content, the economy’s absorptive capacity, Dutch Disease, resource curse in general and the urgent need for a petroleum regulatory body, among other things.
Similar Articles
THE BLUNT OF THE DAY
Sports
Features/Columnists
The PPP/C’s rotten return
Peeping Tom… Kaieteur News- The People’s Progressive Party/Civic (PPP/C) ought to have treated its loss in the... more
Why the U.S. Should Strengthen Trade Ties with the Caribbean
By Sir Ronald Sanders Kaieteur News- A rules-based international trading system has long been a foundation of global commerce,... more
Weekend Cartoon
