Dear Editor,
We, the undersigned, students of the University of Guyana’s Environmen-tal Economics class of 2017, hereby seek space in your newspaper to request clarification on whether a feasibility study was done on the proposed on-shore facility at Crab Island. Additionally, has Exxon Mobil committed to making use of the Crab Island facility by way of an agreement or will this initiative be another ‘white-elephant’? The proposed shore house no doubt will provide a series of services to the emerging oil and gas sector, presumably starting with ExxonMobil’s ongoing exploration activities in the Stabroek Block. According to the Minister of National Resources and the February 8th edition of the Kaieteur News, the Government of Guyana is either investing or facilitating the investment of US$500M in this facility. If a feasibility study was done, we are keen on being apprised of the significant findings of the investment/cost-benefit analysis.
Notwithstanding the foregoing, there are a number of unanswered questions which still linger, to which we respectfully seek answers: Is this venture going to be a pure public or public-private investment initiative? To what extent has the private sector been engaged in conceptualizing this project, given their vast experience in negotiating and handling business transactions?
Our class has some broader concerns. Has Guyana already determined to take royalty payments as profit oil as opposed to money? Is the profit sharing agreement going to allow ExxonMobil to recover 75% of its cost? We understand that the 50/50 split of profit oil was negotiated a while back. Has this split been renegotiated since the major discovery and if not, will it be? Will Exxon pay taxes from their share of profit oil as is done in other Profit Sharing Agreements (PSAs)? What exactly was granted to ExxonMobil in the Kaieteur and Canje Blocks over the period 2016/2017? Was consideration given to a public auction of the Kaieteur and Canje Blocks prior to Exxon obtaining exclusive rights to explore? We wish to bring to the fore an existing model of this auctioning scenario, where not so long ago, the UK conducted auctions in their Oil & Gas sector and was able to get value for money by extracting top dollar/ Sterling pounds for their oil fields. This said, is there a plan for a public auction of other blocks in the future?
Our Environmental Economics instructor, Doctor Thomas Singh, Senior Lecturer in the Department of Economics at the University of Guyana, had attempted to engage ExxonMobil (Guyana) to discuss ways in which citizens can be engaged as more than just mere on-lookers in the emerging oil and gas sector. Unfortunately, Ms. Kim Brasington of ExxonMobil (Guyana) has thus far been non responsive and this begs the question, why the deafening silence?
In furtherance of transparency however, we verily do believe that our national patrimony is at stake in this venture and it behooves us to request that the entire PSA be made public so its contents can be scrutinized. A major contention of ours is whether all the information regarding this deal has been placed in a central repository available to the general public and if not how soon can we expect such a move? Finally, while the GGMC website and elsewhere offers valuable information, is this all the information available on the deal? We sincerely doubt it is!!!
Yours faithfully,
Signed: University of
Guyana’s Environmental
Economics Class of 2017
Student Names
Nalini Persaud
Mahesh Mahipaul
Sean Harmon
Arielle Harsingh
Ryan Goberdhan
Thamesha Watson
Audwin Anthony
Davarshini Doobay
Diquan Lewis
Aruna Jainarine
Khamini Ramlakhan
