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Coalition now wants PPP/C Govt. to correct ExxonMobil lopsided oil contract they signed
Kaieteur News- Almost five years after the coalition had signed an oil contract, internationally criticised as lopsided with ExxonMobil and its partners, it now wants the current People’s Progressive Party/Civic (PPP/C) Government to “fix it.”
The challenge to correct the contract was put forward by the Coalition’s Shadow Minister of the Petroleum Sector, David Patterson, during the 28th Sitting of the 12th Parliament, held last Thursday at the Arthur Chung Conference Centre, Liliendaal, Greater Georgetown.
Coalition’s Shadow Minister for the Petroleum Sector, David Patterson.
Minister of Natural Resources, Vickram Bharrat.
Patterson was at the time responding to the Minister of Natural Resources, Vickram Bharrat, in a debate over a motion he (Patterson) had tabled in the House. The motion was for there to be a special land policy in place for shore bases.
While making his case against the motion, Bharrat related to the House that the Coalition had signed one of the worst Petroleum Sharing Agreements (PSAs) in history.
The PSA Bharrat was referring to, was the one between Guyana and ExxonMobil’s subsidiary, Esso Exploration and Production Guyana Limited (EEPGL), and its partners, CNOOC-NEXEN and Hess, for the lucrative Stabroek Block.
This oil contract was signed on June 27, 2016, by the Coalition that was in power at the time.
Describing the oil deal, Bharrat said, “The PSA which was signed in June 2016 is probably one of the worst agreements in the history of this world or among all oil countries in this world. That was probably the worst oil deal ever.”
The Natural Resources Minister continued his argument by saying, “Mr. Speaker, that is what we have to deal with today, we have to ensure that we create and find ways in which Guyanese can benefit from a lopsided contract.”
In response, Patterson, did not deny Bharrat’s statements that his party had signed “the worst deal ever;” instead, he told the PPP/C Government to change it if it was so bad.
“Sir, if it is so bad, Mr. Speaker, if it is so bad, why don’t you change it?” Patterson responded.
He continued, “We on this side of the House have said over and over again, if it’s a bad deal, we support you to go and change it.”
Indeed, Patterson had called on the PPP/C Government to renegotiate the Stabroek Oil Block Contract during a Sitting of Parliament in September of last year.
Despite his challenge to the Government, Patterson had still sought to defend the deal his party had signed. In a Kaieteur News article headlined, “Patterson challenges PPP Govt. to stop “chirping” and get a better oil deal” he was quoted as saying, he thinks that the Stabroek Block contract the Coalition had signed “will bring tremendous benefit to Guyana.”
During last Thursday’s Sitting, however, rather than defending the deal the Opposition had signed, he told the PPP/C Government that the “ball is in (its) court to fix it.”
“So the ball is in your court. If you want to fix it, fix it and show us,” he said before repeating one more time, “fix it and show us.”
He also advised that it is lunacy to label the Stabroek Block deal as the “worst ever” and still be committed to it.
The local press, over the years, has criticised various aspects of the contract with ExxonMobil as illegal, unfair and/or lopsided.
Kaieteur News has been on the forefront, exposing many of these aspects. One such aspect that this newspaper reported on is the absence of ring-fencing. Without this provision, ExxonMobil can deduct huge sums of cash it spent on unsuccessful wells in the Stabroek Block from the profitable ones like Liza Phase One and Liza Phase Two.
Criticisms that the contract with ExxonMobil was lopsided increased even more after reports surfaced that Guyana’s neighbour to the east, Suriname, was able to negotiate a better deal for its lucrative Block 58.
Suriname will get 36 percent of the revenue from the production of its oil, while Guyana is currently receiving a meagre 14.5 percent. Despite the fact that the current government acknowledges that Guyana’s current deal with ExxonMobil is “the worst ever,” the current Vice President and General Secretary of the PPP/C, Bharrat Jagdeo, has said that his Government will not renegotiate the contract.
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