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Guyana and ExxonMobil going forward
(Kaieteur News) – Guyana’s Stabroek Block is an oil fountain. It is a proven commodity. The oil is light and sweet. The price is cheap, almost a giveaway. ExxonMobil has recovered all of its investment. It has done very handsomely for itself with billions in expenses recovered, some either unaudited, or treated to friendly audits.
What more can ExxonMobil want? Surely, it cannot want to hold onto the lopsided 2016 Production Sharing Agreement that it engineered to its huge advantage, and to Guyana’s loss. Similarly, other questions call for answers. What does Guyana want for its oil? Where does the PPPC Government stand now that the local oil environment has changed? What moves should it make to benefit this country?
ExxonMobil is often informing the world about how it is a trusted partner to Guyana. A trusted partner would not have set out in 2016 to strip Guyana of a fair share of oil profits, through that vile oil contract. A trusted partner that knows from its full range of expertise and exploration activities that the Stabroek Block is virtually risk-free does not resist renegotiating that odious 2016 contract. Cheap, high-quality oil, that is close to refineries and markets is another in an endless stream of advantages enjoyed by ExxonMobil. Yet, this so-called trusted oil partner of Guyana does not want to hear the word ‘renegotiation’. Does not open the door to such a discussion. Citizens sitting on a massive offshore national patrimony have a question to consider. Is ExxonMobil a true partner of Guyana, or is this American supergiant a dangerous predator to the interests of this country?
Just recently, the Chief Executive Officer of ExxonMobil, Darren Woods, announced that it is closing in on some oil discoveries in the Stabroek Block that have incredible commercial potential. It is unknown at this time what that means relative to more barrels of oil. Woods’ own language was brimming with barely controlled excitement. The pending Guyana oil finds could be in the billions of barrels, and keep ExxonMobil at the top of the oil world well into the next century. From an ExxonMobil perspective, it is obvious that the company is on the verge of a breakthrough that does not have equal.
We at this paper think that, with all the superlatives shared by Woods, the company should be willing to let Guyana get more going forward. In consideration of the many US billions made from Guyana’s oil, and with many more billions seemingly about to materialise, there is a great time for ExxonMobil executives to listen to what Guyana wants. The Americans should be ready for good faith negotiations to arrive at some mutually satisfactory point.
The handicap is that the PPPC Government seems to be very contented to let the oil deal remain where it is, and not press ExxonMobil to come to the table of renegotiation. The same people, who once roundly condemned the 2016 contract, are now among its biggest embracers and closest supporters. Vice President Bharrat Jagdeo has disappeared from the oil scene. President Ali who raised expectations with his promise to ‘review and renegotiate’ all contracts is now a shadow of himself, where that is concerned. From all indications, the PPPC Government and its oil stewards seem please to leave the 2016 oil contract untouched, even while it continues to represent serious hemorrhaging on this country.
It baffles us that a sitting government that promised so much is happy to reduce itself to a sitting duck. It has no interest in ring-fencing future projects. This is an area where ExxonMobil has exploited to gouge Guyana of its oil revenues and watch its own profits blow through the roof. Guyana has to know what it wants and set a target. It is obvious that the PPPC Government is so fearful that it wants nothing to do with changes to the 2016 contract terms and conditions. The 2% royalty is an insult. Zero taxes paid by ExxonMobil stand as a national embarrassment. Yet, the PPPC Government will not budge, likes where it is. This mindset must be changed, even if it has to be forced on Guyana’s leaders. Guyana must get more for its oil. The 2016 contract must be renegotiated.
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Maybe a contract to install ‘a refinery & storage facility in Guyana by EXXON!!!