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Renegotiated oil contract could harm Guyana – Jagdeo

The General Secretary of the Peoples Progressive Party (PPP), Mr. Bharrat Jagdeo at his press conference yesterday explained that the renegotiated oil contract between the Government and ExxonMobil could harm Guyana in the long-run based on changes in four clauses which benefit the oil company more than the country.
The four clauses are the extension of the agreement, the stability clause surrounding taxes, the changes to the relinquishment requirement and the regulation of the gas sector.

Jagdeo said if one quantifies the gains ExxonMobil received and will receive from those clauses and compare it against what Guyana will and has received – which he calculated to be US$3B annually – that the country and its people have sacrificed long-term benefits because of incompetence of the government.

“What we have given up might be billions in the future to get a few millions now…it depresses me to see the incompetence,” he expressed.
The Opposition Leader contended that the government ministers “think too small” – as he responded to Minister of Natural Resources Raphael Trotman’s comments on Guyana wanting too much money.

“They can’t have a big picture … they’re just thinking like ‘oh we have a US$300,000 here so we should be grateful forever’,” he posited.

On the issue of the regulation of the gas sector, Jagdeo contended that the sector could be worth billions from no but the Government has locked Guyana into a deal which can see the country not gaining from a potentially lucrative industry in the years to come.

He lamented that once these agreements are signed unto there is very little the country can do. The former President expressed that the PPP is one that respects the sanctity of contracts.

The Opposition Leader also criticized the approach taken by the government during the renegotiation of the contract, slamming them for not hiring the best possible firm to advice or lead the negotiations on behalf of the government against experienced the super major.

“We don’t have the resident expertise in-house to negotiate with a giant like ExxonMobil, we should have gotten the best international experience. There should be a negotiating brief … the president personally should have overseen this,” Jagdeo stated.

He maintained that there are still a lot of unanswered questions regarding the contract such as who negotiated the new deal and the US$18M signing bonus.

The Opposition Leader also maintained that the government did not voluntarily release the contract but was forced by public pressure to do so after more than a year of keeping it hidden from the public.

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