PPP/C has been radically tougher on ExxonMobil than former Govt – AG

– says APNU/AFC saddled Guyana with 20-year permit; no financial assurance

In dispelling a prevailing narrative pushed by sections of society about the recent permit granted to Exxon, Attorney General and Legal Affairs Minister, Anil Nandlall, SC, on Saturday emphasised that the People’s Progressive Party/Civic (PPP/C) Government has been radically tougher on ExxonMobil than the former Government when it comes to regulating the oil and gas sector.
Nandlall pointed out that when A Partnership for National Unity/Alliance For Change (APNU/AFC) left office in 2020, two oil projects – Liza Phas

e One and Two- were in operation. Neither of them had financial assurance.
“You see all this unlimited guarantee that they’re clamouring for? APNU/AFC allowed that operation to take place out there without a dollar assurance. No financial assurance. We changed that. Then they granted an environmental permit for 20 years, to that company. When the law permits only five,” Nandlall pointed out.
The Attorney General noted that had this environmental permit granted by the APNU/AFC been left standing, the Environmental Protection Agency (EPA) would have never had a chance to review Exxon’s operations and its increasing environmental liability as production increased.

“Yet they gave them a 20-year permit. That means the EPA can’t go in, and can’t reassess to put in more conditions… we adjusted it to five years, in accordance with the Act. Now if we were in bed with ExxonMobil, would that be something we would have done?”
“The first license we granted was Payara. When you look at the Payara license and every other license after that. Uaru, Yellowtail, Whiptail. You compare it with the Liza license that they granted. You’re looking at two radically different documents. As constricted and confined as we are, we still managed to include more conditions.”
Some of the framework strengthening done by the PPP/C Administration in the past three years include reforming the Natural Resources Fund (NRF) Act; passing the Petroleum Activities Bill; introducing conditions for, and hosting, Guyana’s first oil blocks’ auction; reforming the model Production Sharing Agreement (PSA); strengthening the Environmental Protection Agency (EPA), as well as issuing environmental permits to operators.
Another key achievement of the Government is enacting, in 2021, Local Content Laws which allow for Guyanese and locally-owned companies to benefit from the opportunities in the oil and gas sector. The Act outlines 40 different services that oil and gas companies and their subcontractors must procure from Guyanese companies.
Efforts are now being made to revise the two-year-old law to expand these earmarked services, and also fix loopholes within the legislation. One issue that needs to be addressed is the practice of ‘fronting’, or ‘renting a citizen’, by which some Guyanese companies and/or individuals are entering into sham partnerships with foreign companies so that those companies can capitalize on the benefits set aside for locals.
Back in August, the Director of the Local Content Secretariat, Dr Martin Pertab, announced that an Enforcement Unit had been set up within the agency to go after those companies involved in these illegal acts. Nevertheless, the Government has reported that the Local Content Act 2021 continues to bear fruit.
In fact, since January 2022, contractors, sub-contractors and licensees reporting to the Local Content Secretariat have recorded 3,938 local hires, 785 of which were within the first six months of 2023. Of this total, 824 Guyanese were employed as plant and machine operators, 1,203 as professionals (accountants, lawyers, engineers, etc.), and another 485 as technicians.
This brings the total number of Guyanese persons employed in the sector to more than 6,000. In accordance with the Act, 33 companies operating in the oil industry have each submitted their five-year master plan detailing employment, procurement and capacity development, and these plans project growth by 601 persons in 2024, 509 in 2025, and 536 in 2026.
Also, in keeping with the Act, annual plans received from contractors, subcontractors and licensees amount to an estimated US$721 million in the procurement of goods and services and training; above the $700 million in 2022 which covered 40 categories of services. (G-3)