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Lopsided deal was signed after pressure from meeting with Exxon and Granger’s team – Trotman reveals in book
Kaieteur News – Former Natural Resources Minister, Raphael Trotman has long borne the brunt of public criticism over what many see as a lopsided oil agreement that gave an ExxonMobil-led consortium the privilege of consuming the lion’s share of the country’s substantial oil reserves, now tipping the scales at an astonishing 11 billion barrels of oil equivalent.
Chartered Accountant, Christopher Ram
But in his book, ‘From Destiny to Prosperity’, Trotman sheds the burden of silence laying bare the intense pressures and the overshadowing influence that curtailed his autonomy in pivotal negotiations. He unveiled a hierarchy of decision-making that positioned former President David Granger, as the ultimate arbiter in the industry’s high-stakes agreements.
Chartered Accountant and Attorney-at-Law, Christopher Ram in his most recent column published by Stabroek News believes this is a salient point that ought not to go unnoticed. Ram found it quite revealing that Trotman’s book exposed that Granger was in key meetings with oil companies, playing a primary role in overseeing the outcome which Trotman had to follow.
In his book, Trotman pointed to two instances where it was quite clear that upon assuming office in 2015, there was a certain structure he would have to follow. He cited the case of having to deal with the British and Canadian High Commissioners on matters pertaining to Tullow and CGX respectively.
With respect to Tullow, the High Commissioner representing this British company was pushing for the APNU+AFC regime to sign and execute a contract for the Orinduik Block which was negotiated just before the PPP/C administration was ousted in the 2015 General and Regional Elections.
Former Natural Resources Minister, Raphael Trotman
Meanwhile, the Canadian envoy was strongly advocating for an extension for CGX, one of the companies involved in exploring the Corentyne Block. CGX needed an extension having failed to complete its work programme within the scheduled time.
Trotman wrote, “What was very interesting and impactful to me was the way these two High Commissioners strongly lobbied for these companies…In the end, the President acquiesced to both requests and I believed then, that the state interests and reciprocity were foremost in his mind when he made the decisions.”
He further noted that Granger’s office at the time, subsequently sent over a draft of the agreement for the Orinduik Block. “My instruction was to sign the agreement ‘as is’ and without any negotiated changes,” the former minister said in his book.
Turning to the Stabroek Block Production Sharing Agreement, Trotman said he and his legal officer “harboured some discomfort about signing.” The former minister said this did not go down well with Exxon, following which a high-level delegation from the company made its way to Georgetown for a meeting with Granger.
Former President of Guyana, David Granger
“The meeting was held in June 2016 and I was one of the ministers present. Suffice to say that after that meeting, I left with the clear belief and understanding that the signing of the agreement must be proceeded with. Thus, the date of June 27, 2016 was earmarked for the signing in Georgetown, Guyana,” Trotman said, further noting that the signing would take place on the evening of June 27, 2016.
The Stabroek Block PSA has faced significant criticism from various stakeholders for its perceived generous terms to Exxon and its partners which include Hess Corporation and CNOOC Petroleum Guyana Limited.
Major concerns raised include the paltry two percent royalty which many argue does not fairly compensate Guyana for exploitation of a non-renewable resource; the costly absence of ring-fencing provisions which allows costs from one oil field to be deducted against the revenues of another; and the permanent stability clause which forbids Guyana from introducing new laws adverse to the oil companies until 2056, barring any extensions. According to the columnist, the criticisms weighed heavily on Trotman and in an apparent pique, he wrote that he was becoming “weary of carrying the burden of the agreement alone and wanted to speak out some more”.
- Chartered Accountant, Christopher Ram, David Granger, Former Natural Resources Minister, Former President of Guyana, Raphael Trotman
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