Guyana and its EITI application … Govt. confident ExxonMobil will cooperate – Greenidge

Mar 08, 2017 News

By Kiana Wilburg
Minister of Foreign Affairs, Carl Greenidge is “absolutely confident” that oil giant, ExxonMobil

Foreign Affairs Minister, Carl Greenidge

will cooperate with Guyana when it comes to the nation’s application for membership with the Extractive Industries Transparency Initiative (EITI).
He made this, among other statements, during a recent interview with this newspaper.
Greenidge’s comments come in wake of the fact that the coalition administration has taken note of the recent action by U.S. President, Donald Trump to repeal a key piece of disclosure law which no longer strong-arms American companies in the extractive sector to divulge what they are paying to foreign governments.
The Government has also acknowledged that Trump’s action will have an impact on all countries which are implementing the principles of the Extractive Industries Transparency Initiative (EITI).
One of the key requirements of any country that is part of the EITI fold is to allow scrutiny of Government’s records of what it receives from companies in the extractive sectors. Guyana is currently applying to be part of the EITI.
While Trump’s action could have an impact on Guyana’s application, and all countries implementing EITI principles and standards, the Government is saying that the impact would not be a “fatal one”.
Greenidge who is advising Government on the matter said that he is sure the administration would have Exxon’s support when it comes to the EITI principles being implemented here.
The Foreign Affairs Minister said, “The point I want to make is that Exxon is a large multibillion-dollar company. It is a company which has commercial obligations in relation to its shareholders and to the market place. It also has

Chairman of EITI, Fredrik Reinfeldt

responsibilities as a corporate entity. We are not starting from the assumption that they will not cooperate because they no longer find themselves in a position where they have a gun to their head from the USA to disclose certain information.”
Greenidge continued, “We have a good relationship with Exxon. And given their activities here, we expect that it will be pretty profitable. From where I sit, we are not anticipating any malfeasance. We need to remember that they started working with us in difficult times. So in terms of the way forward, I am not worried. I believe we will continue to seek to have a cooperative and fruitful relationship and on both sides. We will respect best international practices.”
Since the law was repealed by Trump, it has attracted much criticism from anti-corruption bodies, including EITI. In fact, Chairman of EITI, Fredrik Reinfeldt, has since spoken against Trump’s move.
Reinfeldt said that the law, which had allowed for American companies to disclose what they are paying foreign governments, was a complement to the EITI disclosure requirements.
He added, “I reiterate earlier held EITI positions on this matter. Our aim is to ensure responsible and transparent resource governance and this requires multiple efforts. The SEC (Securities and Exchange Commission) took great care in drafting these rules in consultation with industry to ensure that they complement the EITI’s efforts and avoid unnecessary duplication. I would urge Congress to consider this matter thoroughly, and to ensure that any action does not undermine the hard-won gains in this arena.”

GUYANA’S APPLICATION

With the emergence of a multibillion-dollar oil sector, the Government of the day is of the

U.S President, Donald Trump

belief that EITI is necessary. As such, it is doing everything possible to safeguard the earnings from oil and gas by working to fast track Guyana’s application to EITI.
The Government’s action in this regard is spurred particularly by the declaration of significant oil finds by one of the richest American oil companies in the world, ExxonMobil.
Should Guyana become a member of EITI, it will be required to ask all companies in the extractive sector, including Exxon Mobil, to reveal what it is paying the government, among other things.
While there are a few more stages left to go through, Guyana certainly made significant headway recently as it relates to its application for membership to the EITI with the launching of Guyana’s very own Multi-stakeholder Group (MSG). This is one of the requirements for Guyana to make it into the EITI fold.
Speaking to the importance of the initiative, Dr. Rudy Jadoopat, National Coordinator of Guyana’s EITI Secretariat, said that EITI brings together a number of groups.
He said that these include oil and gas companies, representatives of government, local and international stakeholders and assessment management companies.
The National Director stressed that the objective of the EITI is to bring international and acceptable standards for transparency to the oil, gas and mining sector.
The National Director said: “EITI creates opportunities for the building of trust among stakeholders and indeed the community at large.
“Companies are required to disclose what they pay to government and the government must in turn disclose what receipts from the companies are made.”
“These figures are then compared to discover any discrepancies, and the information made public as a way to foster public scrutiny and greater accountability over natural resource profits earned by governments…”
The Director said, too, that Guyana has already satisfied a number of requirements. However, there are still a few steps which need to be completed. These include adapting the terms of reference of the MSG, determining the materiality and scope, to review and finalize a draft work plan, to prepare a communication strategy and plan for it, to review and ensure the finalization of the scoping study which was commissioned and prepared by a consulting firm etc.
The National Director assured that the Secretariat will provide support to the MSG.

THE GEITI –MSG
Minister of Natural Resources, Raphael Trotman, also provided an update on Guyana’s status thus far. He said that the GEITI –MSG is a primary body which will be responsible for overseeing and coordinating the successful implementation of the global EITI standards.
The Natural Resources Minister said that the body will provide and establish a framework to promote collaboration and consensus building in implementing the EITI accordingly.
He said that the grouping is a true demonstration of inclusivity and transparency as all stakeholders are represented at the table. Trotman said that this includes government, civil society and industry.
With four members and equivalent alternates on the MSG, Trotman noted that the Government will be represented by high level officers from the Ministry of Natural Resources, the Office of the Prime Minister, the Ministry of Finance and the Guyana Revenue Authority. He revealed that the GEITI will be chaired by the Ministry of Natural Resources.
Trotman noted that efforts to find a suitable standalone location for the EITI secretariat have already commenced. He said that hiring additional support staff for the Secretariat has already begun. He hopes to have a full staff for it before the end of the first half of the year.
Trotman said, too, that in the coming weeks, there will be an outreach programme to engage the public on all matters of importance and interest within the natural resources sector.
Oil has been seen as a major boon to Guyana, which has been described as one of the poorest nation in this part of the hemisphere. ExxonMobil’s find is estimated to be at least 1.4 billion barrels.