APNU+AFC have ‘condemned the people of Guyana’ with Exxon lopsided contract - AG Nandlall

APNU+AFC have ‘condemned the people of Guyana’ with Exxon lopsided contract – AG Nandlall

Aug 13, 2023 ExxonMobil, News, Oil & Gas

Kaieteur News – The People’s Progressive Party Civic (PPP/C) continues to insist on the unfairness and lopsidedness of the Stabroek Block Production Sharing Agreement (PSA) to score political points against the APNU+AFC. But despite its constant yammering, the administration has done nothing to remedy the tragedy of an oil deal.

Attorney General and Minister of Legal Affairs, Mr. Mohabir Anil Nandlall S.C. (KN file photo)

In a fiery debate on the Petroleum Activities Bill, Mohabir Anil Nandlall, Guyana’s Attorney General and Minister of Legal Affairs, lashed out at the previous administration, APNU+AFC, over the PSA they signed with ExxonMobil, the operator of the Stabroek Block. The focal point of Nandlall’s concerns was the stability clause embedded in the agreement, which he believes puts an undue burden on the Guyanese people.

The Stabroek Block PSA has been a topic of intense scrutiny and criticism due to the lopsided fiscal terms that many believe do not adequately favour Guyana’s interests. The primary concern raised by Nandlall is the stability clause, which stipulates that any change in Guyanese law after the signing of the agreement, if it is materially adverse to the economic benefit of the contractor, requires the government to “restore the lost or impaired economic benefits to the contractor”. This provision essentially freezes the contract terms, no matter how Guyana’s laws and systems evolve.

Reading out the contentious portion of the agreement, Nandlall emphasized, “That is what you have imposed on the backs of the Guyanese people… even if there is a change in government, and there is a change in the law, and a change in the legal system of the country, this contract shall prevail.” He further articulated that the previous government has made this agreement the “most sovereign and supreme document” in the nation.

The overarching fear expressed by the AG is that such clauses severely restrict the government’s ability to govern and legislate in the best interests of the nation. Especially with a rapidly growing and evolving oil industry, it becomes crucial for governments to have flexibility in policy-making to adapt to changing circumstances. However, Nandlall argued that the government has made many gains to improve the government’s ability to regulate the sector.

The PSA has been criticized by various stakeholders for its generous terms to ExxonMobil at the expense of Guyana’s potential revenues. Critics argue that as one of the largest oil finds in recent decades, Guyana deserves a more favourable deal.

Nandlall also criticized the previous government for hiding the contract and the signing bonus from the public for over a year. “That is the history. That is the sordid history and track record of those who are now going to protagonize transparency and accountability, and lecture to us here,” Nandlall stated.

He called them “born-again champions.”

Despite the glaring concerns raised about the Stabroek Block PSA, the government insists on preserving the sanctity of this lopsided contract. Their steadfast refusal to renegotiate, even in the face of mounting criticism, showcases a concerning complacency towards an agreement that many view as heavily skewed in favour of ExxonMobil.

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Attorney General, Guyana, Minister of Legal Affairs, Mohabir Anil Nandlall, Petroleum Activities Bill

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