Chris Ram urges… All Guyanese should support KN Publisher’s call for key changes to ExxonMobil PSA

Mar 07, 2023 Court Stories, Features / Columnists, News

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– accuses Govt. of engaging in incestuous, unholy relationship with oil companies

Kaieteur News – Though Kaieteur News Publisher, Glenn Lall lost his legal battle to end a 40-year tax free ride for ExxonMobil Corporation and partners in the Stabroek Block; Chartered Accountant, Christopher Ram is of the view that the fight must continue.

In his most recent column published by Stabroek News, Ram said he would encourage all Guyanese to support Lall’s call for changes to certain contractual terms so as to prevent their inherent travesty being perpetuated until 2056 when the Production Sharing Agreement will finally come to an end.

He wrote, “The PPPC Government probably considers the results of the case as a success, enabled by and for the benefit mainly of the oil companies. In the process, it has abdicated its responsibility to Guyanese and broke its Manifesto commitment. As if these are not bad enough, it fails to exercise any regulatory oversight over the oil companies with which it now engages in an incestuous and unholy relationship.”

With this in mind, Ram categorically stated that the fight for contractual changes must not cease. He said, “The battle might have been lost but the war has to go on.”

In recapping some of the key points in Lall’s case, Ram noted that it was on February 22, 2023, that the Guyana High Court handed down its decision in the court challenge. The action was filed on January 22, 2022 naming the Attorney General, Anil Nandlall as the respondent. It essentially sought 17 declarations by the Court that the breadth of concessions granted by then APNU+AFC Petroleum Minister, Raphael Trotman not only to the oil companies but to their affiliates, sub-contractors and employees of the oil companies and their sub-contractors were not permitted by law and were therefore illegal.

Ram said it was on March 31, 2022 that ExxonMobil’s subsidiary, Esso Exploration and Production Guyana Limited (EEPGL) applied to be added as a respondent.

The columnist said, “The optics appear to have been lost on the Government that here it was on the same side of the oil companies fighting a public-spirited private individual citizen who was challenging the agreement which the PPPC Government had committed in its 2020 Manifesto to renegotiate.”

As the case moved to the next stage, Ram said the lawyers for both the government and the oil companies raised procedural issues seeking to prevent the case from being heard. He said the gist of the Attorney General’s response was that the agreement was a contractual matter falling in the realm of private law. He noted that the attorneys for Esso also challenged Mr. Lall’s standing to bring the case, his delay in bringing the action, the manner and procedure in which Lall brought his action, and the right of the Court to hear the matter.

Ram said the Judge ruled that the allegation that the Minister with responsibility for petroleum had acted ultra vires of the provision of statue by granting tax concessions, exemptions and waivers to parties other than the oil companies, justified the Court’s intervention.

While a delay by itself may not justify a refusal by a court to hear a matter, Ram said an applicant has to offer an acceptable explanation to justify an unusually long delay, even if that included 15 months during which the Agreement was kept from the public. He said Lall had proffered that he had relied on the commitment by the PPPC in its 2020 Manifesto to renegotiate the contract once in Government.

In declining the Respondent’s application that the matter be thrown out, Ram said the Court recognised that the case was the first of a kind in a new industry registering a phenomenal growth. The Court also emphasised that it was for those reasons only that it allowed the extensive delay.

Furthermore, Ram said the Court recognised that the purpose of section 10 of the Petroleum Exploration and Production Act, (PEPA) is to authorise the Minister to enter into Petroleum Agreements, while section 51 is to give the Minister the power to direct that the several tax laws referred to in the section shall not apply to or in relation to the licensee.

He said the Court therefore found that the Minister’s powers to grant tax waivers applied not only to licensees, but also to their sub-contractors, affiliated companies, and to their expatriate employees under defined circumstances.

Based on the foregoing grounds, among others, Lall lost his case.

The KN Publisher is currently reviewing his option to appeal the Court ruling.

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• Chris Ram, ExxonMobil, incestuous, oil companies, unholy relationship

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