If Govt. says it wants to renegotiate some terms of oil deal, Exxon and partners will come to the table - Raphael Trotman

If Govt. says it wants to renegotiate some terms of oil deal, Exxon and partners will come to the table – Raphael Trotman

Jul 02, 2023 News

Kaieteur News – Former Minister of Natural Resources, Raphael Trotman, has expressed his belief in a recently published book that the Stabroek Block Production Sharing Agreement (PSA), signed in 2016, can be renegotiated if the Guyanese government shows a genuine desire for change.

“I permanently believe that if the government signaled an intention to renegotiate some terms, that Exxon, Hess and CNOOC would enter the renegotiations,” the former Minister wrote.

Trotman who signed the original deal, and has come forward with this view seven years later said the current policymakers, the People’s Progressive Party Civic (PPP/C), have no desire to amend the deal. In his new book ‘Destiny to Prosperity’, Trotman said the agreement is not immune to modifications. The attorney-at-law said that nothing is set in stone, including the agreement’s strong “Stability Clause.”

This clause is one of the reasons that have been proffered as a reason why the contract cannot be renegotiated. The clause forbids any alteration to its terms, unless all parties, including Exxon and its partners, agree. Further, if Guyana were to amend its tax code or change any law with the effect of infringing on Exxon’s economic benefit, government would have to exempt the block from the legislative change or find a way to compensate the companies for their losses.

Despite this, Trotman expressed his certainty that if there is a genuine desire to alter the terms, it can be achieved through good faith negotiation and compromise. Reflecting on the initial concerns surrounding the agreement in 2015 and 2016, Trotman in his book explained that it was important to strengthen the country’s relationship with Exxon, a US conglomerate with global reach. At that time, he argued that the primary focus was not solely on the financial gains for Guyana but also on establishing a framework that would allow the country to peacefully and comfortably enjoy the benefits of its natural resources.

While Trotman, a former Member of Parliament (MP) has communicated this opinion, the wider Opposition is yet to deliver a concrete position on the question of the renegotiation of the Stabroek Block PSA.

Renegotiating the terms of the Stabroek Block Production Sharing Agreement could provide an opportunity for Guyana to maximize its benefits, ensuring a fair and equitable distribution of revenues, while also safeguarding environmental concerns and the sustainable development of the nation. Vice President Dr. Bharrat Jagdeo has often boasted about his government’s ability to secure greater benefits from the deal in negotiations with ExxonMobil, through Local Content and the Gas-to-Energy project. However, he has not shown fervour or desire to amend this deal. Despite criticising the contract for being unfair, Jagdeo said that Trotman’s book will not be a bother to the government’s position on the contract.

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