Govt needs to release contract signed with Exxon

Dear Editor,

There has recently been much speculation and many questions raised in public and in the press relating to Guyana’s oil and gas prospects.

The main reason for this, I would argue, is simply because people do not know exactly what is agreed with Exxon, and the Government has been refusing to release the contract signed with Exxon.

In March of this year, Minister Raphael Trotman, the sector minister, was quoted at a media breakfast as saying that “(i)n so far as full disclosure at this point in time, I think government is of the view that full disclosure would not be to the best of the national benefit or national interest”.

Quite to the contrary, it is in Guyana’s best interest to release the contract signed with Exxon for three reasons: First, Guyanese need to know exactly what will be Guyana’s “take” (share) of oil production. There are many qualified Guyanese around the world who are willing and able to assist and/or verify the accuracy in the economic modelling, sensitivity analysis and simulations; but refusing to release the contract severely circumscribes that possibility.

Second, knowing Guyana’s take would also allow Guyanese and their representatives to track the money received, so that it does not end up in public officials’ bank accounts, which has always been the single most common causality for resource-rich countries having no or low growth adjusted over time.

The third reason is oil-and-gas investors usually benchmark their investment on the economic modelling of existing hydrocarbon plays adjusted to operational fiscal regimes, so that they could rank global investment opportunities. There is currently global excitement about Guyana’s oil and gas basin, but Government’s refusal to release the contract is severely restricting investment decisions by oil-and-gas companies.

The real question is: Why the secrecy? What is so much in the national interest that the contract cannot be released? The position of the APNU-AFC government is a shocking volte face, or U-turn on the APNU-AFC’s pre-election campaign promise of transparency. More importantly, it is a shocking U-turn on the campaign promise to fight corruption. Unless it is intentional, this single statement sets the scene for what could very well become the largest acts of corruption that will take place in Guyana history, if the contract is not released.

If the APNU+AFC Govt is seriously interested in Guyana’s development, its officials must release the contract with Exxon now. And if all Guyanese, regardless of which party you support, want to receive the benefits of oil and gas production, and not just the recent perpetual promise thereof, they must demand from the Government the immediate release of the contract with Exxon.

Charles S. Ramson