Latest update April 19th, 2024 12:59 AM
Jul 23, 2017 News
…Natural Resources Minister says Commonwealth Secretariat providing help
By Kiana Wilburg
The current Petroleum Exploration and Production Act does not support the disclosure of contracts. But even as the Act is up for review, the government may not be in a hurry to remove those parts of the law which inhibit the release of contracts, particularly the one between the coalition administration and USA oil giant, ExxonMobil.
Kaieteur News asked Minister of Natural Resources Raphael Trotman if Government would be open to removing the parts of the law which seem to prohibit the release of details within oil production contracts.
He said, “Laws are made with specific purposes in mind. In law, we speak of ‘curing a mischief’ and so one has to first determine what was the ‘mischief’ that the framers of the 1986 Act wanted to cure or address and what were the expected benefits from non-disclosure before going to just remove it.”
The seasoned attorney-at-law also noted that Guyana is a small, vulnerable and growing nation.
“I believe that the framers of the law wanted to safeguard our national patrimony as ours without us ‘showing off’ percentage to the world which is not always a hospitable and welcoming place.”
The Minister said that one can compare Guyana to Botswana, which has done very well in managing its resources and the wealth from those resources without baring everything to the world.
“And yet, it is recognized as a state that has done well; despite not being very open about its affairs.”
While the Government may not be in a hurry to make changes to the law, Trotman told Kaieteur News, yesterday, that this should not be misconstrued in any way to mean that the Government has no intention to amend the Petroleum Act. Trotman emphasized that it has to be amended. The Minister revealed that the Commonwealth Secretariat is assisting with the redraft.
“We have received professional advice from overseas that at the present time, we should treat matters of patrimony delicately and not rush to publish everything…”
He added, “We have since asked the Commonwealth Secretariat to review the Act and regulations and those should be ready by October for stakeholders to review before finalizing and taking it to Parliament. I don’t see us rushing this in 2017 but taking our time.”
The Natural Resources Minister insisted that the entire act, including the nondisclosure clause added by former President Bharrat Jagdeo in 1997, is under review.
“We await to be advised,” he added.
TRANSPARENCY
Transparency Institute Guyana Inc. has been calling for the release of the Exxon Mobil Contract. The body has since noted that there might be a serious obstacle to disclosure embedded in governing law, specifically the Petroleum Exploration and Production Act – Cap 65:10. According to the transparency body, the law seems to provide a built-in secrecy clause.
In this regard, TIGI noted that Part II, S4 of the Act (http://goinvest.gov.gy/wp-content/uploads/Petroleum-Exploration-and-Production-cap6510-.pdf) provides as follows:
“4. (1) Subject to subsection (2), no information furnished, or information in a report submitted, pursuant to this Act by a licensee shall be disclosed to any person who is not a Minister, a public officer or an employee of the Guyana Geology and Mines Commission except with the consent of the licensee.
(3) Where a licensee is a party to a petroleum agreement the right of the licensee, his servants or agents to disclose information about prospecting or production operations under the licence shall be subject to any restrictions or limitations in that respect specified in the agreement.
(4) Any person who discloses information in contravention of this section shall, on summary conviction, be liable to a fine of seventy-five thousand dollars and imprisonment for three years.”
TIGI noted that this clause was inserted in 1997. Its application would mean that all the information released to the public is what the oil companies now talking to Government of Guyana want released.
The body said that it is not clear whether this applies to the contract and is specifically asking the government to provide clarity in this regard.
TIGI also expressed concerned about the very existence of this confidentiality clause and wants to know whether it can expect to see it removed in the revised act which is due shortly.
Furthermore, considering that contract secrecy can be injurious to countries rich with natural resources such as oil, TIGI is urging the Government to publish all contract drafts with USA oil giant, ExxonMobil.
The body is also calling for Parliament to be able to shine a light of transparency on all negotiations between Guyana and the said company.
TIGI expressed the view that Exxon, the major player, has a reputation to protect and would shun corrupt transactions.
It said, “While we hope this is true, corruption is not the only problem Guyana has to worry about when dealing with oil companies. One of these is the ability of a small country like Guyana to negotiate with a titan like Exxon.”
The local charter continued, “Most of the cards the government is keeping to its chest are stacked in Exxon’s favour. Exxon is a descendant of the company that invented the oil industry and a key player and superpower in this global sector. Exxon will have more information – a vital element of negotiation – than the Guyana officials will ever dream exists.”
The transparency body added, “An indispensable approach to evening the odds that are stacked against Guyana in the negotiations is to publish the contract drafts and make the negotiations accountable to Parliament.
“In this way, Guyanese of the Diaspora whose knowledge is vast in this area will be able to make contributions to the process and thus protect our country’s interest.”
Furthermore, the body also pointed out that it finds it hard to swallow, some of the reasons proffered in the media by Natural Resources Minister, Raphael Trotman for the Exxon Contract not being released.
In this regard, the body said that the explanation of the non-disclosure being tied to “national security,” is not convincing.
TIGI contended that it is near impossible to undervalue the amount of the oil potential that has already been disclosed to the public, by the international press and in investment circles.
It said that Venezuela has already played its hand in furtherance of its claim to Guyanese patrimony; it is claiming the entire seaway far beyond its original claim to Essequibo. TIGI argued that the amount of information about this oil discovery that can excite the avarice of neighbours is already publicly available.
“It is however, exceeded by the amount of information that was made publicly available in the newspapers of the world when Venezuela celebrated her satisfaction with the ruling of the 1899 award that she considered to be in her favour and which, on the prompting of the world powers of the 1960’s, she found it convenient to vitiate,” expressed the Transparency body.
TIGI said, too, that a security risk may also stem from physical presence in the oil exploration zone as experienced when Suriname moved against the CGX operations a few years ago.
“However, ExxonMobil is currently operating in the Stabroek Block. The link between release of the contract and security risk is tenuous and this calls into question the true motivation for secrecy.”
The body said that the government’s willingness to ignore the mountain of evidence against contract secrecy and the potential ills associated with a developing oil industry is baffling.
“This is especially so given its stated commitment to transparency and accountability. We call for a full release of the contract with ExxonMobil and its partners.”
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