EGCI programme not assisting to draft any laws – MNR

… profit-sharing agreement review abandoned for 1999 50/50 model – Trotman

The Natural Resources Ministry has debunked reports that the United States Energy Governance and Capacity Initiative (EGCI) programme is not playing any role in crafting regulations for Guyana’s burgeoning oil industry.

Rather, the Ministry noted that the Commonwealth Secretariat would be playing a primary role in preparing legislation for the oil and gas sector. This is according a statement and follows an article appearing in The Huffington Post headlined ‘Conflict; Tillerson would write the rules for Exxon’s major oil find in Guyana’.

“The opportunity is taken to indicate that while the EGCI has been lending support to Guyana for the past six years in the area of capacity building to manage eventual oil and gas revenues, it is in no way writing oil and gas laws or regulations for this country,” the ministry stated in a release.

The Ministry did acknowledge that collaboration between Guyana and the EGCI programme commenced in 2010, thus predating the Natural Resources Ministry and the current coalition Administration.

“Indeed, the Government of Guyana has had many engagements with the officials of the United States’ Department of State as part of the capacity building initiative. However, the EGCI programme has only been partially implemented through a series of scoping studies that were conducted in 2016.”

“The EGCI can be a useful programme once implemented and is but one in a raft of assistance measures that Guyana is receiving to bolster and in some cases build capacity in oil and gas governance.”

At a press conference on Thursday, Natural Resources Minister Raphael Trotman was also asked about reports in the Huffington Post article, which suggest that ExxonMobil would get 60-65 per cent of the profits. He denied this and stated that the 1999 profit sharing scale of 50-50 per cent would be used.

ExxonMobil had entered into an agreement with the Guyana Government in 1999, where the 50-50 scale was determined. With regards to the profit sharing agreement, Government was reported to have been reviewing. Trotman said that Government had abandoned this review in favour of the 1999 model.

Conflict

The article had speculated about the conflicts of interest Rex Tillerson, the former Chief Executive Officer of ExxonMobil, would grapple with if he became Secretary of State. Tillerson resigned from Exxon last year when he was nominated by US President-elect Donald Trump. He is currently in the throes of the Senate confirmation process. According to the Huffington Post article, the EGCI programme is currently helping the Guyanese Government write profit-sharing agreements, environmental regulations, and “develop a strong rule of law to counterbalance corporate power.” The article went on to state that “there is righteous critique of this from people who say the main outcome of such a programme would be to help Exxon profit from Guyana’s resources under the patina of rule of law… While that critique may have been valid while Hillary Clinton was Secretary of State, it will be an inarguable fact if Rex Tillerson assumes the Secretaryship.”

The article was written by Jesse Coleman, who the publication listed as a researcher and writer for Greenpeace USA following fracking, the oil and gas industry, and corporate power in politics.

The Extractive Industries Transparency Initiative (EITI) has also been in Guyana to offer advice on regulating the sector. The group is a global organisation with over 50 member countries. It promotes transparency, accountability and good governance in countries with extractive industries.

In addition, former Trinidad and Tobago Energy Minister Kevin Ramnarine has been encouraging Guyana’s Government to take into consideration certain policies, as preparations are made to manage the industry.

The public lectures Ramnarine spoke at were hosted by the Guyana Oil and Gas Association (GOGA), a newly formed organization.