Time may come to initiate renegotiation of 2016 PSA contract, but it is certainly not now

Dear Editor,
Lest there be any misunderstanding at all, I wish to make it very clear that I am not – let me repeat: not – writing this letter on behalf of the Government.
I write it out of sheer disappointment and chagrin that the Stabroek News has descended to the level of the Kaieteur News, and has jumped on the bandwagon of the popular cry for renegotiating the 2016 Production Sharing Agreement (PSA) with Exxon.
Worse, the Stabroek News’ Editorial (Monday, 13th January, 2025) joins its columnist Christopher Ram in singling out President Ali for personal attack.
According to the author of the editorial (it may not be the Editor-in-Chief, Anand Persaud, though ultimately he is accountable), “there is however a big fly in the ointment: the Government of Guyana, or more precisely President Ali. The government is steadfastly refusing to do its duty to invite ExxonMobil to the negotiating table in the same manner that Guyana was invited in 2016”.
This is rubbish. 2025 is not 2016. Our country is palpably now, as distinct from then, hugely benefitting from the massive development taking place from the money that comes from the oil and gas.
In his response to the Kaieteur News reporter at his press conference, who was raising the same question, the President made the point: “I think that you also are aware of the tremendous benefit from the resources we are getting, not only from oil and gas, but from the expanded economy are bringing to our country.”
The President gave examples: “We are able to restore the Because We Care grant that was taken away by the APNU/AFC government, that will go to $50,000 per child. We are giving every single child text books in their school. We are building a world class health care system. We are building an education system in which secondary education will be available to all of our children”.
These are benefits directly affecting each and every one of us. He could have gone on to mention the hugely expanded infrastructure of roads and bridges destined to open up the hitherto unreachable parts of our country for the purpose of development and the expansion of our tourism industry.
According to the Stabroek News, “There has to be some explanation for why President Ali and his government is refusing to invite ExxonMobil to the table when Georgetown accepted such an invitation in 2016”. The answer is obvious, and the President has given it, but the author of the Stabroek News Editorial chooses to ignore it. ExxonMobil is not interested. The contract states that both parties must agree to the renegotiation.
Forcing Exxon to the negotiation table at this point in time would be senseless.
As I pointed out in my letter of 7th January, 2025, we would risk “Exxon shutting down production in the interim, regardless of whether they are legally permitted to do so or not”, and we would witness “a plethora of potential investors cancel their visits to Guyana and those that are here buy their tickets out of Guyana”.
The government has not, as the Stabroek News claims, “refused to renegotiate”, and the President was pellucid at his press conference in explaining: “What we committed to was to respect the sanctity of contract, that’s international law that has implications for us as a country. Other investors are looking on. What we said is that future PSAs would not have these fatal flaws, and future PSAs would not have the type of one-sided arrangement that Exxon had, and we have made those adjustments to future PSAs…we have also to understand the market in which we are operating to ensure that whatever we do from a policy perspective does not drive away investment, but that it strikes the balance where you can have investment whilst at the same time have the greatest benefit to Guyanese people and our country.”
A letter published alongside the Stabroek News Editorial from Dr. Stanley A.V. Paul underscores the wisdom of the President and the Government’s position. Dr. Paul writes, “It is my contention that governance, particularly in time of immense national transformation, must transcend the reactive implementation of public sentiment. Instead, it demands prudence, foresight, and a commitment to balancing the immediacy of popular opinion with the enduring necessity of stability and sustainability”.
The author of the Stabroek News Editorial should have read the letter before putting pen to paper. The Kaieteur News’, and now Stabroek News’ demands for renegotiation have, not surprisingly, provided fodder to others to feed off; such as the disappointing and surprising reaction to this public sentiment by Dr. Vincent Adams – whom I personally respect, and who should know better – in claiming that “the Government of Guyana has cowardly refused to engage the company in dialogue for better benefits for Guyanese”. Dr. Adams should more properly address his concern to his boss in the AFC, Nigel Hughes, whose conflicting legal interest permanently prevents him from even addressing Exxon on the subject of renegotiation.
And then there is the verbose meaningless buffoonery of G.H.K Lall. As the President went on to warn at his press conference, “When you look at the oil and gas sector in totality, and you look at what is happening around the world, Exxon pulled out of Suriname…if you look at the Middle East, and you look at some places in Africa, there is tremendous pulling out of assets. What we have in Guyana is consolidation of assets. So, we have to understand the balance and what is taking place in the market. The market is not simplistic.”
No, it’s not. But sadly, simplistic is an apt description of the collective bleating for renegotiation coming from the Kaieteur News, mimicked now, sadly, by the Stabroek News, for forcing renegotiation on ExxonMobil regardless of the consequences; and at the end of the day, with no predictable results which would benefit Guyana.
Amusing, to put it mildly, was the suggestion from the author of the Stabroek News Editorial that a political party, excluding, of course, the PPP/C and the APNU+AFC, “could contest the 2025 elections on this single issue – renegotiating the contract”, and that this “could put both of the major parties on the backfoot”. Are the owners of the Stabroek News contemplating entering into politics? That opinion alone tells you how incredibly absurd and absolutely thoughtless is the argument for renegotiation now.
The time may come, in fact, for the Government to initiate the renegotiation of the 2016 PSA, but it is certainly not now. Any attempt at it would be a prescription for losing the elections.

Yours sincerely,
Kit Nascimento