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Use new projects to make Exxon pay more

Nov 08, 2022 Editorial

Kaieteur News – We are encouraged that the Coalition Opposition has come out of the shadows on oil.  The latest from the Opposition is that the PPPC Government must use the upcoming fifth oil project (Uaru) as a springboard for pressuring ExxonMobil to give Guyana more for its oil that means so much to the American company’s profits (“All future Exxon projects must adhere to new PSA terms …Norton backs AFC, others on issue”, KN November 7).

Though we have our disagreements with the Opposition (and Mr. Norton) on the pace and strength with which it has gone about pressing the PPPC Government to get more from ExxonMobil for our oil, we agree in principle with the stand now taken by the group. Getting more from future oil projects through skillful use of our approval process is close to our heart, which is what we have been calling for in this newspaper.  We think that this is what Mr. Norton is saying, though in still guarded terms. The Government of Guyana, and its leaders, must use oil projects as leverage to extract more from ExxonMobil. This means President Ali and Vice President Jagdeo, who can be assured of the backing of the main opposition parties.  If there is one issue, aside from the border controversy with Venezuela, that should unite Guyanese, then it is about getting more for our oil patrimony.

Opposition Leader Norton has repeatedly gone on record to insist that he is not for renegotiation per se.  At the same time, he has asserted that he is in full support of any move, any thrust, any development, that puts more money in Guyana’s coffers, which should put more money, it follows, in the pockets of all Guyanese.  It is helpful to repeat his exact words: “While I have stressed previously that I wouldn’t use the concept renegotiation, I have consistently argued that the Exxon contract has a mechanism in which the Government can engage Exxon and get better terms.”  Our position is simple: what’s in a word or phrase, be it “the concept of renegotiation” or “engage…and get better terms”?

To get “better terms” means that there has to be some discussion, and if that discussion does not represent renegotiation, or some ingredient of it, we can still live with that, while we appreciate that Guyana’s Opposition may have to cross it t(s) and dot its (i)s. What is clear is that no political group and no Guyanese political leader in this country desire to come out too strong against ExxonMobil, and offend it.  For to do so, would be to offend powerful political forces in America.  Again, given America’s historical and ongoing pivotal role in the political environment of this country, there is appreciation that both the PPPC Government and the Coalition Opposition are walking on eggshells with our oil wealth.

We don’t like it, but understand it, and try to coexist with it, as best as we can.  It is why we favor what is coming out of the Opposition.  Better terms on future contracts, making the best use of approvals of projects in the pipeline, and of which the fifth one (Uaru) is just a matter of weeks away.  Those new Production Sharing Agreement (PSA) terms announced by Vice President Jagdeo, with much fanfare, must be put into action as the minimum standard (if not better) that applies.  We call upon Mr. Jagdeo for the Uaru project to be the proving ground for his new PSA.  This new PSA must apply to ExxonMobil, and it must apply to the incredibly rich Stabroek Block, where the massive oil deposits are.

As Mr. Norton pointed out, America is “seeking better deals for its oil” and he is “thankful that Exxon invested” here.  These are in keeping with what we have been saying all along, and on which we have been breaking ground almost daily right in these pages.  ExxonMobil must profit, but so, too, must the people of this country. New PSA terms must not be a “smokescreen” to hide the PPPC Government’s (and Mr. Jagdeo’s) resistance to renegotiating the oil contract.  The new PSA terms must be the bottom floor to get much more for Guyana for its oil.

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