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Clean up costs
(Kaieteur News) – ExxonMobil and the Guyana Government are pleased to tell to the world how they are in a mutually rewarding partnership. If this is a partnership, why is it so one-sided? Why is one partner, ExxonMobil, always in the driver’s seat, the controller of the relationship, with the PPPC Government playing along? We look at this partnership, and interpret it in one of two ways. It is the slavish cooperation of one group before a vastly more powerful partner (hand in tiger’s mouth scenario), or willing collusion that helps selfish interests to prosper. Clean-up millions for years in the hands of Guyana’s oil partner, ExxonMobil, stand as a blatant outrage. Why is that money with ExxonMobil alone, and not held by this country?
After six years, US$965M has been deducted from Guyana’s oil revenues, and under the company’s sole control. Guyana has to have a say in that US$965M, either jointly or exclusively. We at this paper are concerned that the PPPC Government is happy to say almost nothing, nibble around the edges, of close to US$1B that has been deducted by ExxonMobil for decommissioning costs. Sealing wells so that they are safe. Removing production vessels (rigs) and all their attachments and supporting lines and linkages. All of these are components of oil production occurring in Guyana’s offshore environment. Accordingly, it is compulsory that the Guyana Government has a say and stake in those hundreds of US millions held exclusively by ExxonMobil. Considering new production platforms are in operational assembly line, cleanup costs will soon surpass US$1B. Why is Guyana on the sidelines, and sitting on its hands? We share what the oil companies are doing, and where the government once stood.
Vice President Bharrat Jagdeo once took this position: “if the project hasn’t started as yet, my assumption is that you can’t deduct from it for decommissioning if it hasn’t even been commissioned as yet.” But this is precisely what the oil companies own financial reports confirm. They are not only taking out millions from this country’s oil revenues for current oil projects, but for ones that have not produced a single barrel of oil yet. If Vice President Jagdeo is of the same view today, then he should put an end to that scheme that shortens this country’s already meager oil profits. He has to do more, should not shrink from doing what protects this country.
ExxonMobil cannot continue to have sole control of cleanup millions. It is wrong in conception, and worse in practice. For a national government to sit idly by, and allow that to happen, sheds significant light on whose interests it prioritises. When has ExxonMobil been fair and straight with this country? When has ExxonMobil proved that it is and will continue to be a partner worthy of the trust of Guyanese? To leave approximately US$1B in its hands must qualify as the height of leadership recklessness, and reeks of either impotency or a different type of government-oil company partnership.
The PPPC Government is not short of sound advice, or tools. The commonwealth secretariat has warned about the dangers of oil companies walking away from decommissioning costs, and leaving countries stranded. The secretariat has published its “Oil and Gas Decommissioning Toolkit”. It is a valuable resource for host countries interested in protecting themselves. President Irfaan Ali did not react well when it was presented to him that the commonwealth secretariat was offering sound advice for countries like Guyana. The record is that when something poses any whiff of a threat to the ruling party’s cozy relationship with the oil companies, it is flat out rejected.
Six years into oil production, almost US$1B deducted for cleanup, and ExxonMobil virtually owns that billion. Yet, the PPPC Government is busy playing the same games that could harm this country later. The government is dragging its feet. It is hunting around for the right cover words. So, as not to lift a finger that could interfere with ExxonMobil’s taking out and locking away that US billion. A protective government, a government that is a partner more to Guyanese and less with ExxonMobil, would take a clear stand. There must be, at least, joint control of all cleanup monies deducted.
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