ExxonMobil didn’t “strong arm” Guyana, it severed our arms with a lopsided deal -Certified PublicAccountant

Jul 19, 2019 News

In 2016, the APNU+AFC Government renegotiated a Production Sharing Agreement (PSA) Guyana had with ExxonMobil’s subsidiary Esso Exploration and Production Guyana Limited (EEPGL), and its two other partners, Hess Corporation and CNOOC/NEXEN.

ExxonMobil Country Manager, Rod Henson

After unceasing calls for its release, the PSA was finally made public in December 2017. From then to now, everyone besides ExxonMobil and its affiliates have found the deal to be utterly lopsided. International, regional and local critics have called for its renegotiation, since it leaves Guyana collecting the crumbs, while the operator walks away with the lion’s share of the profits.
In spite of this, Country Manager for ExxonMobil, Rod Henson, has maintained that Guyana got a good deal; a deal that benefits both parties. In fact, the official reiterated these sentiments during an interview with a section of the media this week. The official said that it did not come to Guyana and “strong arm” anyone. He said that it was Guyana’s own model agreement that was used and it is “working well”.
Henson further stated said that changes at this point would scare away investors.
Upon taking notice of these and other comments, several critics are left wondering if Henson believes that Guyanese are fools.
Specifically making this remark in a letter that is published in today’s newspaper is Certified Public Accountant, Charles Sugrim. The concerned Guyanese questioned whether the Country Manager would have entered such an agreement if he were the owner of the resources in the Stabroek Block.
In addition to this, Sugrim said that Hess Corporation CEO, John Hess is correct when he said that his company did not “strong arm” Guyana. What occurred was far worse. The Accountant asserted that Exxon actually severed Guyana’s arms with such a contract.
“We have no one who is competent in the administration to represent us. The government’s model contract you referred to was picked up from a dustbin and dressed up to look like a contract. I have gone through the contract of almost every oil-producing country, and none is as ludicrous as the one you forced upon us. Your comments are outright dishonest and must be rejected by all Guyanese.”
Citing recent comments by Hess Corporation’s CEO, to the effect that the Stabroek Block reserve of 5.5 billion barrels of oil is on the lower end, the Accountant questioned whether Henson would honestly say that the US$18 million signing bonus given to Guyana is reasonable.

In this regard, Sugrim said, “If we were to have a signing bonus of 1/2 of 1% of 5.5 billion barrels, and with a market price of US$50 per barrel of oil, we should have had in our coffers US$1.375 billion. If we had received a ¼ of 1 %, we would have collected US$687 million. Compare that amount with the paltry US$18 million, Mr. Henson, and you see how pathetic and condescending your comments are to the Guyanese people.”
Sugrim also highlighted Henson’s remark that the Stabroek Block contract “is working well”. In this regard, the Accountant stated, “Sure, it is working well, but for whom? Surely, it is not working for Guyana and the Guyanese people. You would have seen in Kaieteur News a daily advertisement showing the Royalty other countries receive for their oil reserve and the paltry 2% Guyana will receive.”
The concerned Guyanese added, “I am giving you notice Mr. Henson, that with a new government, this lopsided contract you so boastfully say is good, would be renegotiated. Stop spreading fear of chasing away investors. For too long, these so-called investors you have alluded to have screwed Guyana and the Guyanese people.”
Collectively, Sugrim opined, Guyanese have the resources, skills, and the ability to create a more productive and prosperous country as soon as it can get rid of the incompetence of this and previous administrations.

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