Sep 21, 2020 News
Alliance For Change (AFC) Member of Parliament, David Patterson is now challenging the Irfaan Ali administration to renegotiate the Stabroek Block agreement with ExxonMobil.
During his address in Parliament on Thursday, the shadow Oil Minister reminded that the People’s Progressive Party Civic (PPP/C) has repeatedly promised throughout its elections campaign to renegotiate contracts in the oil sector.
“It is well within their right as the sitting government to do as promised,” Patterson stated. “They have been chirping for more than three years that there is a better deal to be had. Well, if there is, go get it.”
He added that the Opposition will not stand in the way of any process that would bring additional benefit to the people of Guyana. Local press has shed light, over the years, on various aspects of the contract with ExxonMobil, Hess and CNOOC, which have been criticised as illegal, unfair and/or lopsided.
Most daunting was recent news that Guyana’s neighbour to the east, Suriname, will take home 36 percent of the revenue from the production of oil out of its lucrative Block 58. This represents a staggering share of the revenue when compared to the 14.5 percent Guyana is taking home from production in the more lucrative Stabroek Block.
Controversy over the contract gained ground internationally when anti-corruption watchdog Global Witness released the report, Signed Away, which outlined the suspicious circumstances under which former Natural Resources Minister, Raphael Trotman awarded the contract. Global Witness said that Guyana will lose about US$55B over the life of the agreement due to its poor terms.
It also urged renegotiation, and an investigation into the circumstances surrounding the award. When the report came out earlier this year, the APNU+AFC coalition defended its handling of the 2016 award. It said that the contract was fine.
Patterson on Thursday said that some assertions being made about the efficacy and value of the contract are baseless. He thinks the contract will bring tremendous benefit to Guyana. It is the opposition’s belief, according to Patterson, that the contract signed in 2016 was a vastly improved one, when compared to the 1999 agreement signed by the PPP/C.
The Vice President, Bharrat Jagdeo had said during his time as Opposition Leader that the contract is poor. He had said that it was necessary for the 1999 contract to give ExxonMobil generous terms because there was no indication that Guyana’s offshore was so lucrative.
He said that for the 2016 contract, however, there can be no excuse for the poor terms. The renewed contract moved the royalty from one percent to two, among some marginal changes.
Despite accepting that the contract is poor, Jagdeo has said that the PPP/C will not renegotiate the deal.
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