(CMC) –The United Kingdom-based, anti-corruption organisation Global Witness on Monday called on the new Government in Guyana to immediately investigate and renegotiate the US-owned oil giant Exxon’s exploitative oil licence to ensure the country has the funds needed to rebuild after divisive elections and a debilitating novel coronavirus pandemic.
In a statement, Global Witness said that in February 2020 its exposé ‘Signed Away’ revealed that Guyana could lose billions of US dollars from a 2016 Exxon oil deal, according to a report by the fiscal analyst firm OpenOil which it had commissioned.
“The deal, for an offshore licence called Stabroek, has bad financial terms, thanks to Exxon’s aggressive negotiation tactics with inexperienced Guyanese officials,” the UK-based group said.
“With Exxon increasingly dependent upon an immense Guyanese oil find, President Irfaan Ali has a remarkable opportunity to make a new deal, while showing the interests of all Guyanese – not Exxon – are at the heart of his Administration,” said Jonathan Gant, senior campaigner at Global Witness.
In February, the then main Opposition People’s Progressive Party-Civic (PPP-C) dismissed, as a “lame excuse”, the allegations by the ruling coalition Administration that Global Witness was seeking to interfere in the March 2 regional and general election through its exposé.
The David Granger Government had earlier issued a statement condemning the 28-page report, by Global Witness, on the oil industry in Guyana, in which it claimed that the agreement signed with the US-based oil giant, ExxonMobil, in 2016, would deprive the country of up to US$55 billion.
But then Opposition Leader Bharrat Jagdeo, speaking at his weekly news conference, said the PPP-C had nothing to do with the commissioning of the report, titled ‘Signed Away: How Exxon’s Exploitative Deal Deprived Guyana Of Up To US$55 Billion’.
“The People’s Progressive Party did not bring Global Witness here. We have no such powers over Global Witness, which is an international NGO [non-governmental organsation],” Jagdeo said, adding, “I suspect that its presence here was largely triggered by this Government’s own act”.
In its statement yesterday, Global Witness said that the former Government “rushed to sign Exxon’s deal despite knowing the company would soon announce new oil find results” and while experts were informing them to seek more information.
It said that Exxon’s licence is the subject of ongoing litigation in Guyana, with civil society groups arguing it is illegal.
“Global Witness believes President Ali’s Government should investigate Stabroek to determine if it was properly awarded. Exxon has denied the deal is bad for Guyana and disputes Open Oil’s analysis, as has the oil data company Rystad. In January, the then-Guyanese Government said the deal was reasonable and that Guyana needed Exxon during the country’s maritime border ….with Venezuela,” the group said.
“Guyanese people deserve a new deal for schools, hospitals, and sea defences to hold back rising sea levels – and with an economy weakened by COVID-19, they need it now,” said Gant.
“With these new funds in hand, Guyana can do its part to fight the climate emergency and ban any new drilling by oil companies.”
The statement said that Jagdeo, “who is now Guyana’s vice-president, has previously pledged to renegotiate the country’s oil licences once in power.
“However, he made a specific exception for Exxon, stating he would not renegotiate the Stabroek deal. According to press reports, the new Government has now commissioned a “review” of one of Exxon’s smaller licences called Payara.
“Global Witness believes renegotiating the Stabroek contract with Exxon is possible. Even before the outbreak of COVID-19, the company was highly dependent upon its Guyanese oil finds. As oil prices have crashed during the pandemic, Exxon has continued to point investors to Guyana as a reason for hope.”
Grant said that “now is the time for President Ali and Vice-President Jagdeo to not only make good on their campaign promises, but to do one better.
“Guyana’s oil licences – including Exxon’s Stabroek – should be renegotiated. Guyanese people deserve a better deal. And if the Government is not prepared to give them this, then the people should call for these bad deals to be cancelled,” Grant added.