Gov’t to pronounce on ExxonMobil’s contract soon
DPI/GINA, GUYANA, Wednesday, May 31, 2017
Minister of Natural Resources Raphael Trotman said that the government is in the process of finalising ExxonMobil’s production licence.
The Minister made the announcement to stakeholders in opening remarks at the Guyana Extractive Industries Transparency Initiative (GEITI) capacity building symposium which was held at the Pegasus Hotel, Kingston, Georgetown today.
“Government has received an application for a production licence to be issued to ExxonMobil. We are finalising that process, and will be making some pronouncements in the next few weeks,” Minister Trotman said.
The existing contract is a 50-50 partnership Production Sharing Agreement (PSA). Exxon and its partners will be allowed to recover the cost invested in the offshore production before the equal sharing of the profit oil.
The government had undertaken a review of the contract which dates back to 1999. Minister Trotman had indicated that the review was to update the contract, but assured that the government respects the “sanctity of contracts entered into.”
There have been various calls in the local media for full disclosure of the contract between the government and ExxonMobil and its partners. The Minister had indicated earlier this year that the government does not believe full disclosure would be in the national interest.
Exxon and its partners, Hess Corp and CNOOC Nexen, made its significant oil find back in 2015 after drilling the Liza Field in the Stabroek Block located about 120 miles offshore Guyana.
The oil company is currently in the developing phases of the Liza field with oil production projected for 2020.
Today, Minister Trotman noted that signing onto initiatives like the EITI standard is part of building trust and better relationships as the country develops its oil and gas sector.
“I know there is a natural suspicion that governments are always up to something bad, something suspicious, (and) something that is unholy and unhealthy. But it is comforting to know that government has partners in both the industry and civil society to hold its hand, to hold their hands, so that together we can develop our resources in the best possible manner,” Minister Trotman said.
Guyana is hoping to join the EITI by year end. The EITI is an international standard that seeks to provide consolidated information on a country’s extractive sector. It aims to reconcile key revenue flows paid by companies with those received by government and assesses how the revenues are expended on behalf of the people.
By: Tiffny Rhodius