Chartered accountant Tameshwar Lilmohan says that the prognosis for renegotiating the much-criticised 2016 Production Sharing Agreement (PSA) with ExxonMobil’s subsidiary is very bleak and Guyana’s best chance would be to seek a “good faith and conscionable review” for fair and equitable terms from the partners to the deal.
The 2016 PSA for the Stabroek Block was concluded in secret by the government with Esso Exploration and Production Guyana Limited (EEPGL). Its 2% royalty rate is among a number of provisions that have been deplored as the PSA was concluded after the major discovery of oil in 2015. Exxon is the operator of the block and multinationals Hess and CNOOC are its partners on it.
In research work that he concluded and shared with Stabroek News, Lilmohan said that a case could be made for the proposition that Guyana has a grossly unfair deal with EEPGL and would, therefore, wish to rescind or favourably amend the terms of the Agreement. He noted that Article 26.1 states that the Parties shall make reasonable efforts to resolve amicably all disputes by negotiation.
