Grounds for renegotiation

Dec 30, 2024 Letters

Dear Editor,

There are factors which may require the urgent and necessary intervention of the Government in the oil and gas sector so as to ensure the safety and security of the region. One such factor could be the impact of localized climate change. If it is shown to have an adverse impact on the occurrence and severity of the hurricanes and other negative climate events such as those recently experienced by the Caribbean, then we as a nation must take the necessary and responsible steps towards altering our actions in the oil and gas sector.

One of the keys to such an adjustment is the altering of article 32.3 of the petroleum agreement between our Nation and ESSO, CNOOC and Hess. Article 32 speaks to the stability of the agreement and 32.3 specifically discussing the importance of no hindrance to the economic benefit to the supplier if there is a change in the laws of the country, which would impair the economic benefits currently being received. This speaks again to the implied importance of adequate insurance coverage and the inflexibility of the contract.

As a sovereign nation, this clause is quite restrictive and should be reviewed by the courts to determine severability. Article 32.3 is far reaching and positions the supplier’s economic benefit above the actions of the government and the courts. It is CRG’s contention that this clause may be invalid and unenforceable as it restricts the sovereignty of the Nation. To be a sovereign nation means to be able to self-govern and this should not and cannot be relinquished to anyone by way of a contract. The broad restrictions imposed by Article 32.3 brings into question this principle of law, which prevents a Country from giving its sovereign powers away via a contract. Article 32.3 also raises the question as to whether it restricts the Government’s ability to protect the public interest.

CRG requests that the current Administration and the Courts of Guyana review Article 32.3 of the 2016 petroleum agreement to determine its legality.

Best regards,

Jamil Changlee

(Grounds for renegotiation)

Discover more from Kaieteur News

Subscribe to get the latest posts sent to your email.

CNOOC, economic benefit, ESSO, Grounds for renegotiation, petroleum agreement, stability of the agreement

Latest News