Gov’t emphasises ‘arm’s length’ relationship with Exxon

Attorney General and Minister of Legal Affairs, SC, Mohabir Anil Nandlall has assured that the relationship with oil giant ExxonMobil is built on a foundation of mutual benefit, governed by contracts, licences, and Guyanese laws.
Speaking with the media on Saturday, the AG clarified that the contractual arrangement is designed to ensure that both Guyana and foreign investors benefit.
“I can assure you that it is a relationship that is arm’s length, and one that the government uses to ensure, having regard to the given parameters, that the people of Guyana get the best possible deal from the oil and gas sector,” the minister underlined.
To further emphasise the distant relationship, the legal affairs minister pointed to a range of measures aimed at holding the company accountable and maximising benefits for Guyanese citizens.
Notably, Guyana has developed a new model Product Sharing Agreement (PSA) and adjusted the terms of environmental licences granted to Exxon to align with Guyana’s legal framework.
The AG recalled that the previous government granted licences to Exxon without financial assurances.
“APNU+AFC allowed that operation to take place out there without a dollar assurance. No financial assurance. We changed that,” Minister Nandlall pointed out.
According to Minister Nandlall, what was even more telling was that the APNU+AFC Coalition granted the oil giant an environmental permit for a 20-year tenure, even though the law only permits a five-year duration.
“So, the Environmental Protection Agency would never have had an opportunity to review that operation. Yet, they gave them a 20-year permit. So that means that the EPA could not reassess to put in more conditions, to assess the operations,” he emphasised.
He said the law limits that permit to five years to allow for monitoring and reassessment. The PPP/C Government has adjusted the permit to five years, per the law.
“If we were in bed with ExxonMobil, would that be something we would have done,” the minister questioned.
Other measures to strengthen the sector’s management framework include the revamped Natural Resources Fund Act, the Petroleum Activities Act, and the regulation of oil block auctions.
In addition, the Local Content Act is being strengthened to address any loopholes that may grant the contractor the upper hand.