Jan Mangal, former Petroleum Adviser to the President, says ExxonMobil’s Payara oil well development should not be approved until it yields big changes to the much-criticised 2016 deal including a higher royalty rate than the current 2%.
Mangal believes that while the company has been adamant that changes cannot be made to the Production Sharing Agreement (PSA), the fact that the Environmental Protection Agency (EPA) has been able to secure unlimited liability insurance coverage for accidents and spills and ensure it has unfettered access to offshore operations, is demonstrative that the company will give in to what it wants.
“We are seeing EPA announce small wins because those are easy. Exxon hasn’t given up much, and that is Exxon gave what it wanted. These small wins, these are easy things for Exxon. We know that we are making progress when we can get the big wins; the increased royalty, a new contract that doesn’t have a stability clause…a generally fairer contract overall,” Mangal told the Sunday Stabroek yesterday.
