Latest update June 27th, 2024 12:59 AM
Jul 10, 2022 News
By Davina Bagot
Kaieteur News – At a time in history when the price for oil has reached a record high, pushing governments across the world to slap petroleum companies with additional taxes to benefit from the windfall being enjoyed by those companies, Guyana is continuing to pay taxes on behalf of ExxonMobil, an arrangement that must be halted, according to protestors.
This protestor has made her position clear that the petroleum companies operating in Guyana must pay their taxes or leave the country’s oil alone
Guyana’s leaders have been silent regarding the payment of these taxes on behalf of the oil companies and have been instead preaching their belief in the ‘sanctity of contracts’ while the oil companies relish in revenue from the country’s resources being extracted daily.
Guyanese who are against the Exxon contract signed in 2016 with the Government of Guyana have been demanding that changes be made to the agreement for several weeks now, taking to the streets to register their dismay.
This past week, as the global price for crude stayed consistently above US$100 per barrel, protestors in Guyana insisted that the major oil operator in the country pay its own taxes, or leave Guyana and its resources. Several placards were held to this tune by citizens urging that: ‘Exxon must pay their own taxes’, ‘No tax, no oil’ and ‘Pay your taxes or get out’.
The public demonstration, which is being spearheaded by Kaieteur News Publisher, Glenn Lall, was held during the week at Houston public road, in front of the Guyana Shore Base Inc. (GYSBI) office on the East Bank of Demerara.
In Guyana, where daily oil production is now in excess of 200,000 barrels per day under the Production Sharing Agreement with ExxonMobil Guyana and their partners for the Stabroek Block, the country’s decision to take on the responsibility of paying the taxes means that it is losing out on big time.
In fact, in the first year of oil production in Guyana, the country agreed to take on responsibility for taxes more than what it collected in royalty that year.
According to recent financial statements submitted by Esso Exploration and Production Guyana Limited (EEPGL), Hess Guyana Exploration Limited and CNOOC Petroleum Guyana Limited, the income taxes to be paid by the oil companies in the first full year of production, accumulated to payments of $5,751,060,980 or about US$27,552,901.83.
The country in 2020 collected some US$184.9 million in profit and US$21.2 million in royalty for a total of US$206 million.
As such, it would mean that government agreed to pay to the Guyana Revenue Authority (GRA), more money than it received in royalty payments for that year representing payments made on behalf of the oil companies.
Under the PSA at Clause 15.4, (a) it stipulates that the Minster of Natural Resources agrees that a sum equivalent to the tax assessed to be paid by the Minister to the Commissioner General of GRA on behalf of the contractor—ExxonMobil Guyana – and that the amount of such sum will be considered income of the contractor.
Additionally, at 15.4 (b) the Minister also agrees that the appropriate portion of the Government’s share of profit oil delivered, shall be accepted as payment in full for the contractor’s share of Income Tax and Corporation Tax—levies owed to the GRA.
One female protestor on Wednesday encouraged Guyanese to join the picket line, arguing that Exxon is getting away with stealing from the country. She said, “Guyanese wake up. ExxonMobil thieving out we oil. We got to wake up and fight fuh we oil.” The woman was keen to note that if the company is allowed to continue its operations without changes to the agreement, future generations will be left to suffer with no benefits from the natural resource.
Friday marked six consecutive weeks since the protestors commenced their demonstration, demanding changes to the oil contract. The activity had commenced about two weeks before the renewal of the Liza One Permit in May at the Square of the Revolution on Vlissengen Road, Georgetown.
This country does not hear anything about oil from the PPP or the PNC
Jun 27, 2024
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