EPA begins assessment for Exxon’s 7th project – Jagdeo

Apr 20, 2025 News

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…additional fiscal benefits for Guyanese to be determined upon completion

Kaieteur News- The Environmental Protection Agency (EPA) has started its assessment of ExxonMobil Guyana’s 7^th project, Hammerhead, and according to Vice President Bharrat Jagdeo, a determination of the fiscal benefits to be derived from the project will be known thereafter.

Jagdeo told Kaieteur News on Thursday that a thorough assessment is being done by the Agency and once completed, Guyanese would be informed of additional fiscal benefits.

“Their assessment for Hammerhead, has started, so you have to have an assessment, and they’re looking at all of these things… the FDP’s, etc…If the assessment is favourable, and they move to approve the project, you will hear of that shortly, but I can confirm that the assessment has started,” Jagdeo said in response to a question posed by Kaieteur News about the additional fiscal benefits for Guyanese.

Earlier this week, Kaieteur News reported that Italian multinational oilfield services company Saipem secured new offshore contracts in Guyana and the Middle East worth approximately US$720 million.

Saipem signed a Limited Notice To Proceed (LNTP) agreement with ExxonMobil Guyana Limited (EMGL) for engineering, procurement, construction, and installation (EPCI) works related to the proposed Hammerhead oil field development project, the seventh project in the prolific Stabroek Block.

Exxon’s application for the Hammerhead development is pending at the Environmental Protection Agency (EPA). That development has an estimated life of 30 years.

It is important to note that the Vice President was repeatedly asked about the additional fiscal benefits to be derived from ExxonMobil’s 7^th project.

On two occasions, he said that Exxon had yet to submit the full set of documents and information needed to commence the review, therefore, the issue of additional benefit could not have been looked at the time.

Asked a third time, he directed this publication to the Minister of Natural Resources while noting that he is not in tune with the day-to-day operation of the oil sector.

With the US oil giant rapidly moving to sanction additional projects, the fiscal benefits available to citizens have become a grave concern of the public, with members of civil society demanding more.

Ad for consultant pulled.

On October 25, 2024, this publication reported that Jagdeo announced that the government discontinued an advertisement for a consultant to review Exxon’s seventh project, saying that the information the company presented at that time was incomplete.

Previously, Jagdeo, when speaking about the seventh project, had said that there is an assumption that there would be a seventh project. However, recently the government had advertised for a consultant to review the same project. He was asked if he had a change of heart regarding the project and whether there would be any fiscal improvements if it is approved.

In response, he said he had instructed the Ministry of Natural Resources to discontinue the advertisement.

Jagdeo questioned the logic of hiring a company to review incomplete information, highlighting that Exxon has been making the submissions in parts. “So, the original position stands, when I saw that ad, it was brought to my attention and I called the minister and said discontinue it because until we have a full submission from Exxon, we are not gonna start the review process and I expect them to make a full submission sometime next year,” the VP said.

VP cannot say if there will be additional benefits

In December 2024, Kaieteur News reported that the government is unable to say whether the country will obtain improved fiscal benefits from the seventh oil project –until ExxonMobil makes a full submission about the project and that submission is reviewed by the government.

Jagdeo was asked by Kaieteur News to state whether there will be any improved fiscal benefits to the country should the project and others be approved.

In response, the government’s chief oil spokesperson said, “I don’t want to be premature. We have not received the full application from Exxon, and when that application comes in sometime next year, we will review it.”

He explained that after a thorough review of Exxon’s submission, he will disclose what the fiscal benefits will be. “So, my position is still the same, we haven’t received an application as yet, and we will deal with it at that time,” Jagdeo said.

Opposition urges govt. to secure more for the people

The opposition parties have all come out to urge the government to seek better benefits. The People’s National Congress Reform (PNCR) is of the view that the government should engage ExxonMobil Guyana Limited on better fiscal terms for Guyanese ahead of granting the permit for the 7^th oil project.

Advisor to the party on oil and gas, Elson Low, said the party always held the position that it is critical for the government to have discussions with ExxonMobil to derive additional benefits for the people of Guyana.

Low was asked by Kaieteur News whether his party believes that more benefits ought to be obtained before the approval of the project.

“It doesn’t have to be at the instance of the granting of an additional permit, it could be in the near future. It could be that the government engages with consultants and with legal representation to have that discussion and prepare itself. Rather, we have not seen any movement on that front,” Low said.

The PNCR representative recalled that the People’s Progressive Party Civic (PPPC), while in opposition, had promised to renegotiate the contract. However, that position has since changed now that the party is in government. Low called on the government to use the request for a licence as an opportunity to have discussions with ExxonMobil.

The Alliance For Change (AFC) also believes that the Government of Guyana needs to secure additional fiscal benefits for its people ahead of the granting of a permit to ExxonMobil Guyana for the 7^th oil project.

During the party’s press conference back in December, Kaieteur News asked whether the party believes there should be more fiscal benefits ahead of the approval of the permit. Chairman of the party, David Patterson, told reporters that Vice President Bharrat Jagdeo, who is also the country’s chief policymaker on oil and gas, should focus his attention on deriving more benefits from the oil company.

“Jagdeo and the PPP, instead of doing what they should be doing, trying to make the country better, are taking out the big stick method, threatening that they will withhold permission on 7^th project,” Patterson said.

Co-Leader of the Working People’s Alliance (WPA), Dr. David Hinds, in December of last year, said his party is concerned about government engaging ExxonMobil in a lopsided arrangement. He said Guyana must leverage its ‘sweet crude’ for any future negotiations. Dr. Hinds told reporters that “we (WPA) think, given what we have, given the volume of oil that we have, given the quality, the sweet oil that we have, we do have some leverage there, and that our government should exercise that leverage. So, WPA is not opposed to renegotiation with Exxon that would bring maximum benefits to our country.”

He explained that the WPA is interested in ensuring that any future negotiations between Exxon or any other oil company and the government are free from the mistakes of the past in terms of the 2016 PSA.  The co-leader of the party made it clear that he is not asking the government to take the members of the opposition to the negotiation table when the negotiations are to be done, but rather there should be consultations with the political oppositions any other major stakeholders before engaging Exxon, highlighting that this is something they feel strongly about. “We think that was one of the weaknesses of the first negotiation. Secondly, we would like some of the issues that were raised about the first negotiation to be ventilated.”

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• 7th project, additional fiscal benefits, Hammerhead

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