Guyana could renegotiate for 15% royalty - Nigel Hinds

Guyana could renegotiate for 15% royalty – Nigel Hinds

Sep 27, 2022 News

– unwillingness of politicians will lead country into crisis

Kaieteur News – International experts and other oil and gas stakeholders have warned particularly, Third World nations entering the lucrative crude industry against the unequal distribution of wealth emanating from this sector. They have warned against the Dutch disease where countries become heavily dependent on oil revenues, and virtually ignore their traditional sectors, but continue to speak also, on the importance of equal wealth distribution as a means of economic and social stability.

At this time, civil society activist and accountant Nigel Hinds does not believe that Guyanese politicians are heeding these warnings. He in fact believes that the country’s two main political parties are too caught up in their ways rather than coming together for the benefit of the nation. He said it was time that they band together and demand to renegotiate the oppressive Production Sharing Agreement (PSA) that Guyana currently has with the Exxon Mobil consortium operating in the offshore Stabroek Block. In an address to overseas Guyanese at Hyde Park in New York, London over the weekend, Hinds said that the unwillingness of the nation’s politicians to co-operate on the PSA has left Guyana open to control by the oil companies. He believes that if the politicians were willing to work together for Guyana, they would have been able to come up with a better fiscal arrange to garner more money for the nation.

Accountant and activist Nigel Hinds during his address at Hyde Park, London

He insisted that although Guyana has “a lopsided and disadvantaged, cockroach contract” with Exxon Mobil, it seems that none of the political parties is willing to address the problem. He said that the PSA “has reduced us (Guyana) to the point where ExxonMobil is running the country and which every administration that goes in, they don’t have the backbone it seems…” Hinds continued that both administrations; former and current, “…could by decree, and by their willingness to oppose this draconian contract, adjust the royalty rate from two percent to at least 15 percent.”

What Guyana currently has, he said, is “Exxon getting 98 percent of the monies coming out of the contract, and they have put in front of that all kinds of pre-contract cost that are unauditable, and we simply don’t have the resources and the personnel to do it.” A simple solution to the problem, he proposed, “… is to just give us 15 percent and then they can do the rest. We take the 15 percent off the top and that’s the simple solution.” But beyond that, Hinds said what is absolutely necessary is governance for the people, “not governance for a particular demographic or a group. This is destroying the country and will cause conflict and crisis and confrontation. We don’t want to go back to the 1960s where there is communal violence and burning and looting,” he urged.

Hinds has made statements in the past few weeks claiming that the current government is not only inadequate in its efforts to get a better deal for Guyana, but that it is taking the little it is receiving to serve mainly its supporters. This he described as institutional racism practiced by both political parties. In these parties, he stated, there is institutional racism where the presidential candidate of the party is always of a particular ethnicity while the second in command is of another ethnicity, but serving basically as a “rubberstamp”. He said that the parties would have individuals in particular positions, and while some may have the power to be part of the decision making, “…some are really just window- dressing where they are put in power primarily because of their skin colour or ethnicity.” Hinds said that Guyana needs to move away from institutionalized racism and learn to share in the patrimony if the country is to really benefit from its oil wealth.