The 50-50 profit sharing is a sham

Aug 15, 2022 Features / Columnists, Peeping Tom

Kaieteur News – Imagine that you have a shop but you need a partner to help you with it. So you enter into a partnership with another person.

The person gives you an agreement to sign in return for the partnership. That agreement says that the profits are to be split 50-50. You think that half and half is a good deal. But it is only a good deal if the other party is bearing half the expenses.

However, you find out that this is not so. The agreement which your partner gives you to sign says that they will supply the goods for the store but you have to pay them for it in full.

And the agreement also states even though you are paying back for all the goods, the other partner gets half of the profits. So let us assume that the other partners supply $10,000 worth of milks and eggs to you. You have to pay them back this sum, plus you also have to give them half of whatever profits you make.

And to make matters worse, you do not have a say in what they send to you to put in the store. They decide on all the goods and the price at which it is purchased for you.

This is what the oil companies are doing to Guyana. Guyana owns the shop – the oil is ours. The oil companies bear no risks at all because all the operational expenses are cost recoverable. So whatever they spend they claim back. It is Guyana which is paying for the costs. On top of this Guyana has to give half of the profits to the oil companies. And Guyana has no say in determining what the oil companies spend. It does not even have a say in how much oil is produced. Which country in the world does business in this manner?

Then when it comes to paying taxes, it is Guyana which has to pay the oil companies’ taxes. So here you have a store, you are paying for all the goods and expenses. Someone else is taking half the profits and when it comes to paying their taxes, they also send the bill to you.

How can this ever be fair? This is the biggest con in the history of oil agreements.

But even more tragic is that by the time the oil runs out, Guyanese are still going to be poor. Multinational corporations have a history of raping countries of their resources.

Guyana has had this experience before. Reynolds and Alcan took out millions of tonnes of bauxite ore and by the time they left, Guyanese working in the industry were still poor. Bookers was involved in sugar cultivation and production. By the time they left, sugar workers were still pauperised. Omai came and drilled out millions of ounces of gold and never declared a profit. They left and Guyanese were still poor.

By the time the oil barons leave, the oil would have disappeared and Guyanese will still be poor. How can this be fair?

But it does not have to be this way? If the people protest peacefully against what is taking place with their oil resources, they can force a change.

But the people expect the government and the Opposition to do their bidding. The people are looking in the wrong direction; the government and the Opposition cannot be expected to bring about the change that is needed with the oil contract.

The Opposition, APNU+AFC, cannot call for renegotiation of the oil contract because to do so would be to condemn their own agreement. The government is clearly not interested in renegotiating the contract unless they are forced to do so through peaceful public pressure

This leaves the people without an ally in the government or Opposition. But the people have champions in our society who are objecting to the oil agreement and are demanding a renegotiation. There is a small weekday protest taking place against the oil agreements. The protest is small but it can become bigger.

It is time for the people to not hide behind their leaders’ frock tails and coattails. The people have the power to force peaceful change in the agreement. But so long as they continue to hope that the government and the Opposition will opt to renegotiate, the people will end up in despair.

Guyana deserves a better deal. Guyana has to have a better deal. The oil companies are not taking any risks. Once oil was discovered, the entire Stabroek Basin was de-risked. It means that the oil companies bear no risk. Whatever they spend on exploration and production they are reclaiming as cost recovery expenses. It is Guyana which is bearing all the risks. Whatever is spent has to be repaid.

Is that a deal. or a steal?

(The views expressed in this article are those of the author and do not necessarily reflect the opinions of this newspaper.)

Latest News

The 50-50 profit sharing is a sham

Related

Similar Articles

The Glenn Lall Show | December, 2nd, 2024

Follow on Tik Tok @Glennlall

THE BLUNT OF THE DAY

Sports

The wait is over, all roads lead to KMTC for their Grand Boxing Day...

Xhiya Hercules – flipping the script towards...

Road Warriors, Bent Street, Team Cruel &...

Deol maiden hundred outshines Matthews’ as...

Moraikobai village two days football competition...

BCB thanks cricket fraternity for strong support...

Features/Columnists

Merry Christmas, Ya Filthy Animals!

Breaking the Chains of Poverty: A need for political will

Christmas – reality and possibility

Publisher’s Note

Weekend Cartoon

Bridge Watch

Demerara Harbour Bridge

> Berbice Bridge […]

The 50-50 profit sharing is a sham

Share this:

Related

Similar Articles

The Glenn Lall Show | December, 2nd, 2024

Follow on Tik Tok @Glennlall

THE BLUNT OF THE DAY

Sports

Features/Columnists

Publisher’s Note

Weekend Cartoon

Bridge Watch

Demerara Harbour Bridge

> Berbice Bridge […]