As questions continue to be raised about the prospect of a ‘renegotiation’ of the Production Sharing Agreement (PSA) between Guyana and ExxonMobil, officials from both the Guyanese government and the oil company are adamant that the contract is valid and should be respected.
The PSA, originally signed in 1999 before oil was discovered, and amended in 2016, paves the way for oil production to begin in 2020 after ExxonMobil and its joint venture partners Hess and CNOOC Nexen would’ve made their final investment decisions to move forward with development of oil fields offshore.
Speaking to members of the media at the opening of the Private Sector Commission’s Oil & Gas Seminar on Tuesday, ExxonMobil Guyana’s Senior Director, Public and Government Affairs, Kimberly Brasington, said in any industry the sanctity of a contract is very important both for companies and the country. “We believe firmly in that principle that there is real value in the sanctity of a contract and there are a lot of eyes on Guyana right now watching to see how this plays out and is this a stable environment in which to do business.”
Ms. Brasington further stated that the company is committed “to being a good partner and we want to be your partner for decades and with that comes conversation and dialogue…”
Meanwhile the South American nation’s Business Minister, Dominic Gaskin also used the opportunity of the PSC Seminar to weigh in on the calls for renegotiation of the contract and spoke about the context within which the agreement was arrived at.
He told those gathered, “You don’t unilaterally amend a contract after the other party has invested hundreds of millions of dollars under the terms and conditions of that contract. Governments have to behave responsibly when it comes to business dealings, especially if we want to do more business in the same industry.”
Mr. Gaskin reminded those in attendance that ExxonMobil “had a valid agreement with the government of Guyana which was not up for renegotiation,” referring to the 1999 contract. “…there was no obligation on the part of the company to enter into any negotiations with our government,” he said, referencing the new administration which took office in 2015.