Former EPA Head: Guyanese must hold Govt. to account and demand release of interest rate on ExxonMobil US-multibillion $$$ investments

Nov 19, 2023 ExxonMobil, News, Oil & Gas

Kaieteur News – Former Environmental Protection Agency (EPA) Head, Dr. Vincent Adams has blazed the Peoples Progressive Party /Civic (PPP/C) government for the lack of transparency in the interest rates which American oil giant ExxonMobil is charging Guyana for its multibillion-dollar investment in Guyana’s oil sector.

Dr. Adams, who appeared at an Alliance for Change (AFC) press conference last week, was asked about Exxon’s 6th oil project which is about to be approved with no cap to the interest rates, and whether this concerned the party.

“The first thing is that here again it’s about transparency. I don’t know what the interest rate is. Which brings up another question in terms of the NRF {Natural Resource Fund}, where the NRF is apparently making 1.36% (interest) but we are going out there and taking loans like drunken sailors and nobody knows what the interest rate is,” Dr. Adams said.

He said an interest rate of 10% was mentioned in the public domain; however this is yet to be confirmed by the government. He described the interest rate situation as “kitchen table economics” since according to him, the NRF rakes in a mere 1.36% but the country is borrowing loans at an average 10% interest rate.

To date, ExxonMobil has invested more than US$40 billion to develop the country’s oil and gas sector. Guyanese are still in the dark on the rate of return on this investment.

Dr. Adams reiterated, “I do not know what those interest rates are, in terms of capping the government would not reveal it, but I would expect that capping would be something that should be a necessity regardless of what it is. But nevertheless at least we ought to know what the magnitude is in terms of what we are paying for because we are the ones who are paying it.”

He emphasised that it is not the government which is footing the bill. “It is our money,” he said, adding that, “we have got to understand and open our eyes and hold them accountable for they should be telling us what those interest rates are.”

Billions of US currency is being deducted annually from Guyana’s oil resource to pay back the ExxonMobil-led consortium for its investments in the Stabroek Block, yet Guyanese are not privy to the expenses being racked up by these companies or the interest rates attached to the financing of the projects.

Vice President Bharrat Jagdeo during a press conference in June was asked about the interest rates but avoided the question.

Earlier in his press conference, the VP said Guyana was paying a rate to Exxon since it is a standard practice for a return to be generated on the company’s equity. “Regardless of whether you make the financing in the form of a loan or equity you have to get a rate of return. There is a cost of capital and that is how it is,” Jagdeo asserted.

This newspaper in a follow up question to the former Head of State’s remarks queried whether there was a standard rate Guyana is paying.

The subject of a standard rate is particularly significant, given that Guyana has already been warned by the International Monetary Fund (IMF) that the country could lose massive revenue by failing to cap the interest rates on the investments for its oil projects.

The IMF said it is an industry norm that the government of the day disallows interests from being recovered on loans. Even if this is allowed, the administration sets a cap or limit to prevent the full interest amount from being recovered. The IMF pointed out that Guyana not only allows the recovery of the interest but also sets no cap.

In his response to the specific question however, the former President told this newspaper, “We are not paying anything. The Government of Guyana is not paying anything because they have to raise the financing using the best efforts; the cheapest cost of financing that is what they are supposed to do as a company, so this is what can be analyzed even when you look at the cost bank.”

Before further questions could be asked, Jagdeo requested that the press conference “move on.” The response from the country’s chief spokesperson on the petroleum sector casts a gloomy picture on what the true cost of capital is, and the total revenue Guyana could be losing annually on interest payments.

Dr. Vincent Adams, ExxonMobil, Former Environmental Protection Agency (EPA) Head, Government, Guyana, People’s Progressive Party/Civic (PPP/C)

Latest News

Former EPA Head: Guyanese must hold Govt. to account and demand release of interest rate on ExxonMobil US-multibillion $$$ investments

Related

Similar Articles

Follow on Tik Tok @Glennlall

The Glenn Lall Show | June 16, 2025

THE BLUNT OF THE DAY

Sports

Guyana Cup returns August 11 with over $50M in prizes up for grabs

2025 CPL draft to stream live today

Caribbean Regional Table Tennis Championship 2025...

Yarrowkabra Sec’ thump BV to claim 2025...

Elton Dharry, Keevin Allicock, Dexter Marques...

Final group stage matches set for this Saturday...

Features/Columnists

Does the mandate of the Ethnic Relations Commission extend to offensive but non-racial comments?

Antigua and Barbuda hosts the OAS at a crucial juncture for the Americas

Baby Skello, another go

Publisher’s Note

Weekend Cartoon

Bridge Watch

Demerara Harbour Bridge

> Berbice Bridge […]

Former EPA Head: Guyanese must hold Govt. to account and demand release of interest rate on ExxonMobil US-multibillion $$$ investments

Share this:

Related

Similar Articles

Follow on Tik Tok @Glennlall

The Glenn Lall Show | June 16, 2025

THE BLUNT OF THE DAY

Sports

Features/Columnists

Publisher’s Note

Weekend Cartoon

Bridge Watch

Demerara Harbour Bridge

> Berbice Bridge […]