Tullow, Oh tricky Tullow

Aug 21, 2023 Editorial

Kaieteur News – When Guyanese thought they had seen and heard the last of the UK’s Tullow Oil operating here, the company had its own plans already firmly cemented. In essence, Tullow Oil is physically gone from Guyana, but it is still very much present, very much immersed in Guyana’s oil. The details are in the money arrangements that the company put in place, and from which it could profit sweetly from a distance. Once again, Guyanese are educated on how skillful and sophisticated foreign oil companies can be, and how tricky they also are, when it is this much in demand commodity that is involved. The Government of Guyana could take a page or two out of the playbook of the likes of ExxonMobil and Hess Corp and Tullow Oil, and do so much better for Guyanese.

Like the tricky Greeks of Homeric legend, who got bogged down outside the walls of Troy, Tullow Oil gave the appearance of actually physically withdrawing from Guyana’s oil sector, only for it to reappear through its own version of Trojan Horse arrangements. The British company still stands to walk away with a rich harvest from Guyana’s ever-expanding oil sweepstakes (like the Greeks did in Troy). This is how the numbers favouring Tullow Oil look.

When the deal is sealed with Eco Guyana Oil and Gas (Barbados) Ltd, Tullow Oil collects US$700,000, which is a nice piece of change for stepping from the forefront of Guyana’s oil, but staying in the shadows. Tullow Oil still lurks in the long, possibly rich shadows of Guyana’s Orinduik oil block, and could collect a sweet US$4 million should its partner make a sizable commercial discovery in the block that it supposedly relinquished. This is how pieces and parcels of this country’s oil patrimony, the birthright of every Guyanese, are passed from hand to hand, as if they are the wholly owned property of these foreign exploiters, to do with as they please. But the gravy train does not stop at US$700,000 and US$4 million, for there is a bigger payday that could still be.

If developments in the Orinduik block were to call for it, and based on its helpful track record, the PPP/C Government is almost guaranteed to issue a much sought after production license. In such an instance, Tullow Oil is back in the picture, with more millions coming its way, viz., US$10 million. It is a lush ongoing stream of millions that Tullow Oil receives for seemingly walking away from Guyana’s oil. What this emphasizes is that even the smaller players, like Tullow Oil, never stop benefiting from Guyana’s oil, including when they wipe the dust from their feet and turn their backs from here.

The PPP/C Government, and its people who hold themselves as bright bulbs, could learn a thing or two from Tullow Oil. To facilitate possible future participation in a profitable oil find by its partner in Guyana, Tullow Oil came up with the beauty of “working interest entitlement revenue” (less capital expenditure and costs). It is a fancy, convoluted way of saying that Tullow Oil has locked in a share from any profits in oil found in the Orinduik block. Its financial advisers and investment bankers most likely had a huge hand in designing this sharing arrangement. The people that Tullow Oil engages to work for it, or offer expert guidance, or have some creative relationship with the company, constantly look for ways to keep it in the running should Orinduik take a profitable turn.

In contrast, there are Guyanese in, or tight with, the PPP/C Government, who do not look for ways to wrest or slip this country out of the grievously wounding ExxonMobil oil contract. Instead, there is a pack of Guyanese lacking in any shame or self-respect, who defend the plots that foreign oil companies are involved in here. They do so through attacking their fellow citizens, who insist that ways can be found to weaken the contract. There are ways to tie up ExxonMobil, for Guyana has laws to follow, and those existing laws could be weaponized, should the company insist on playing hardball. Unfortunately, what Guyanese have is a bunch of whimpering politicians, bending over for ExxonMobil.

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