Jagdeo’s excuse to grant Exxon extension on Stabroek Block deceiving – AFC

Aug 19, 2023 ExxonMobil, News, Oil & Gas

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…EPA, Ministry of Health, Public Works granted company permission to work through COVID-19

Kaieteur News – The Alliance For Change (AFC) is questioning the grounds on which the Government of Guyana (GoG) has extended ExxonMobil’s hold on the 26,800 square kilometers Stabroek Block.

The multinational corporation was expected to relinquish a 20 percent portion in October this year; however, Vice President Bharrat Jagdeo has announced an extension of the relinquishment provision for a period of one year, owing to the company’s work programme being delayed by the Corona Virus (COVID) Pandemic.

According to the AFC, this excuse is unacceptable, since the company was granted permission by multiple state agencies to continue their operations uninterrupted.

During a press conference on Friday, the party in an invited comment explained that the Ministry of Health, the then Ministry of Public Infrastructure (now Ministry of Public Works) along with the Environmental Protection Agency (EPA) had approved the company’s work plan to continue its operations during the pandemic.

Several documents were shared with Kaieteur News to this end. In fact, a Gazetted Order dated April 9, 2020 for ‘Emergency COVID-19 Measures’ granted ExxonMobil permission to continue its operations as an ‘essential service’.

In fact, this provision allowed for the oil giant to work for 24 hours. The Order was specific to “(r) businesses that ensure global continuity of supply of mining and petroleum materials and products…(s) mining and petroleum development operations, production and process; (t) mineral and petroleum exploration and development; (u) mining and petroleum supply and services that support supply chains in the mining and petroleum industries.”

In this regard, Patterson noted, “As Minister of Public Infrastructure at the time, Exxon were allowed special flights and I have copies of them right in front of me fortunately and there were special flights for crude changes, essential offshore activities and there are several there – July 10, 2020, special round trip to Port of Spain, July 14, 2020, June from Houston, we have from London. So what happened during that period of time all their personnel was allowed to come in by charter even though the airports were closed.”

The chartered flights were approved weekly by the Guyana Civil Aviation Authority (GCAA), an agency under the remit of the Public Works Ministry.

He added that the Ministry of Public Health was even providing a special service to allow Exxon to continue their operations through this period. Two floors of the Marriott Hotel in Kingston, Georgetown were rented to provide a quarantine facility for the staff of the company in addition to other locations in the country, the former Minister pointed out.

Patterson therefore argued that ExxonMobil’s operations were not impacted during the pandemic. He was keen to note that in keeping with the Gazetted Order, ExxonMobil’s contractors and suppliers were also granted a waiver to continue their activities as well.

The Opposition Member of Parliament (MP) said that while he can attest to the Coalition not hampering the company’s work programme, the People’s Progressive Party (PPP) administration should come clean on whether the decisions it made caused Exxon to be affected.

It can be recalled that when the PPP returned to office, it reversed several of the COVID-19 measures instituted under the previous government to facilitate a “re-opening” of the country. This included the return of international travel and the ultimate lift of a ‘curfew’ among others.

Patterson therefore noted, “We totally don’t agree that they should be given any extension…there was no hindrance to their operations.”

Supporting the comments made by the MP was Executive Member of the AFC and former Head of the EPA, Dr. Vincent Adams. He told reporters, “There was no impact whatsoever (to Exxon), I was there until August of 2020 and Exxon’s business operations continued as per normal. Throughout we were holding meetings, we were putting together documents with Exxon; nothing stopped Exxon. Their production was not impacted.”

This newspaper in a follow up query asked the party whether Exxon’s exploration programme could have been hampered; however, it maintained that this was not the case.

“The short answer is no. It’s the same ship…the crew changes were not only for production; the crew changes were for Exxon activities. It included Exxon personnel; the tier one personnel; the people who are doing the exploration, who are doing the surveys, all of them came on one charter…so it did not impact any of their activities.”

The former EPA Head also noted that “it was business as usual” for the company since the Agency processed all the Permits for exploration and other activities in a timely manner.

In June this year, VP Jagdeo revealed that the Stabroek Block partners- ExxonMobil, Hess and CNOOC- were granted an additional year to keep the concession, since it was affected by COVID.

He said, “The force majeure that was given to them in the COVID period extends the relinquishment provision.”

The extension of ExxonMobil’s hold on the concession was also raised by Chief Executive Officer of Hess Corporation, John Hess who noted that the partners will get more time to explore the block since they experienced setbacks during the height of COVID-19 in 2020.

The CEO said, “During COVID, we really had a force majeure period because Exxon couldn’t even get workers in the country. We couldn’t run three rigs for exploration. So we took that exploration drilling pause…”

Already, the main political Opposition has called on the government to justify extending the relinquishment provision, since no documented proof in this regard has been provided to Guyanese.

During the Opposition Leader’s press conference on Thursday, the spokesperson on Oil and Gas, Elson Low explained, “While I can understand COVID-19 being a reasonable reason, what I would always ask is can the government provide to the public, a document which is evaluating the situation; which they were able to receive expert advice as to whether or not they should relinquish.”

Low pointed out that over the past few years, ExxonMobil through the Stabroek Block operator, Esso Exploration and Production Guyana Limited (EEPGL) has substantially ramped up oil production, pushing Guyana’s Gross Domestic Product (GDP) above its forecasted growth.

He therefore reasoned, “This indicates that the company’s operations are functioning and have been functioning well. What we need to see is what evaluation has the government done to determine that the company’s operations were inhibited and what evaluation was done to give us an understanding that the company should not be relinquishing the blocks.”

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• COVID-19, ExxonMobil, relinquish, Stabroek Block, unhindered

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