Dear Editor,
Now that details of the oil deal between Trotman and Exxon are coming to light, there are attempts from the APNU/AFC Administration to confuse citizens and deny responsibility. However, at the onset, let’s ask ourselves one question: if Trotman was doing such a great job, why did Granger demote him from the Ministry of Natural Resources?
For the record, when the PPP/C under Mrs Janet Jagan issued the exploratory licence in 1999, none of the oil companies here today were banging on our doors. Before the Exxon bonanza, there were no prior discoveries and the atmosphere was suffused with risk from an exploration standpoint. It costs hundreds of millions of US dollars to mobilise a drill rig, note that CGX is still struggling in this regard, and Guyana was still considered out of the way geographically. Besides that, oil was available from cheaper and easier sources such as US shale. To compensate, PPP/C had to grant terms, which are now considered very favourable, to attract oil companies. PPP/C was operating with a weak hand but it would have known, and as is customary, that when oil was discovered in commercial quantities (de-risked) that was when the real negotiation would begin.
By the time Trotman was ready to sign with Exxon in 2016, the PPP/C exploratory licence had expired. No one was going to deny Exxon, but without a valid licence, that company was naturally disadvantaged. This is the reason for the mysterious Bridging Deed, which sought to extend the life of the expired licence to give Trotman legal standing to sign the contract with Exxon. By the way, according to Christopher Ram, the Bridging Deed is illegal. For the ordinary man, the Bridging Deed seeks to breathe life into something, which is already dead and buried. Trotman/APNU/AFC cannot, therefore, claim that they were constrained by the expired PPP/C issued licence. If anything its expiration augmented their bargaining position.
Expired licence aside, APNU/AFC was holding several trump cards at this stage: the confirmation of commercial quantities, the high quality of the crude, proximity to the US/T&T, and the biggest of them all – the promise of larger quantities of oil to come. The latter should have caused a prudent Administration to pause, take stock and leverage it. If they felt constrained with the expired PPP/C licence it certainly could not prevent them for bargaining for a better deal in discoveries yet to be made. It also could not prevent them from ring-fencing the various sites. In contrast, according to Global Witness, Trotman et al refused to wait to hear of additional discoveries and bluntly brushed aside advice before rushing to “sign away”. Earlier we heard that this Administration agreed to pay the taxes of the oil companies from our share of profits. This makes Guyanese a bigger laughing stock than the 34 is the majority of 65 argument. And that is not the end of it. True to form, APNU/AFC studiously refused advice to devise local content legislation, which actually benefits us locals. This Administration also chose not to secure a deal for the natural gas, which is extracted with the oil, which is extremely valuable, owned by us and which can be used to generate cheap electricity we so desperately need to create jobs and build our country.
Trotman/APNU/AFC giving away G$12,100,000,000,000 (twelve trillion, one billion dollars) dwarfs the sum total of all previous acts of corruption alleged and real. I am sure the ensuing investigations will reveal more bad news for Guyana, as there can be only one possible explanation for this seemingly unthinkable level of negligence.
Sincerely,
Ravi Ram
