Former Guyana President says no illegality surrounds award of oil blocks; calls probe ‘political ploy’

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Guyana’s former President, Donald Ramotar

Guyana’s former President, Donald Ramotar, who held direct responsibility for petroleum at the time offshore oil blocks, which are currently the subject of an anti-corruption probe, were awarded, is calling the investigation a political ploy designed to distract from “inept management” of the country’s oil and gas sector.

Mr. Ramotar served as president from 2011 to 2015. His full statement follows:

For over a week now the politically tainted officials of the State Assets Recovery Agency (SARA) have been engaged in what is undoubtedly an attempt to divert attention from the inept management of Guyana’s oil and gas sector by APNU+AFC Coalition Government.

Matters of fact, as it relates to, primarily, two exploration agreements I signed before the 2015 General and Regional Elections, have been distorted by SARA’s embattled top two officials into material for their campaign of misinformation.

As the then President of Guyana with responsibility for Petroleum, I wish to make the following facts absolutely clear:

  • The applications by companies for exploration in the Kaieteur and Canje Blocks date back to 2012 and 2013, respectively.
  • Both applications were processed and approved by the Guyana Geology and Mines Commission (GGMC) in accordance with the relevant laws and regulations around late 2013. All fees paid were fixed by law and were paid to the GGMC, not to any private accounts.
  • Dates of signing and sequence of subsequent discoveries are all in the public domain and were published in the Official Gazette for the public’s information. There was full transparency on this.
  • Delays in the signing of the agreements were due to matters surrounding Venezuela’s navy seizure of Anandarko contracted seismic vessel Technic Pardana in late 2013.
  • At the time of application, processing, approval and signing of the Petroleum Prospecting Licenses for the Kaieteur and Canje blocks in Guyana’s offshore there was NO confirmed commercial petroleum discovery in the area by ExxonMobil or any other company.

I wish to point out that the PPP/C advertisement, which was reproduced in the Kaieteur News publication on May 31, 2019, substantiates this position. For ease of reference, I quote the first point of the advertisement, in part: “An Exxon oil exploration well …offshore Guyana has discovered hydrocarbons, a strong indicator of the evidence of oil.”

The advertisement, which was published on May 8, 2018 – after the agreements were signed confirmed that no oil was found.

The GGMC, as a matter of government policy, was for many years, encouraging exploration interest in our offshore given the United States Geological Survey’s estimate of Guyana’s

hydrocarbon potentials and also to have a presence to reassert our territorial rights over the area. This was one of the reasons for what some term generous fiscal concessions. There were simply very few other ways to stimulate interest in exploration. Prior the confirmed oil find in 2015, our basin was considered very high risk. In fact, in 2014, Shell voluntarily gave away its rights to half of the entire Stabroek block for a mere $1.

It is a transparent political ploy that the agreements I signed before the change in government is now the subject of a SARA investigation.

Professor Thomas in the May 22, 2019 Bloomberg report stated that aside from the Stabroek, Kaieteur and Canje which Exxon has control over, Orinduik block which Tullow Oil Plc signed up to explore in 2016 will also be investigated.

However, a contradictory position was proffered by SARA’s Aubrey Retemeyer, who said only the circumstances around ONLY the two agreements I signed would be investigated.

Mr. Retemeyer made this admission in a May 29, 2019 report published by the Associated Press, where he was quoted as saying: “Our focus is on Canje and Kaieteur Blocks and how those blocks were awarded.”

How could this not be political?

Additionally, why is Professor Thomas silent on the new agreements signed by Natural Resources Minister, Raphael Trotman, under the current Administration, after the confirmed oil find, which included provisions not dissimilar to the ones I signed, as President, when there was no confirmed oil find? Would it not have been better for Guyana if new provisions were included in the contracts signed by Minister Trotman, since there was a confirmed oil find of an estimated three billion barrels? Why were stronger agreements not signed? And why is this failure something that SARA is not looking into? Is it that SARA is convinced that the APNU+AFC cannot stand scrutiny?

Mr. Retemeyer was also quoted in the May 29, 2019 Associated Press report as saying: “They were handed the blocks without any public auction.” Is this not duplicitous? The agreements signed by Minister Trotman were also not subject to auction. Further, until today, there is no policy decision on whether the remaining oil blocks will be auctioned or not.

Another APNU+AFC operative, Eric Phillips, is reported to have told the Kaieteur News that he wants to ascertain why no signing bonus was negotiated. I am appalled that after four years in government that a person in such a senior position would raise such an issue which displays a total lack of understanding of the issue. We could not negotiate a signing bonus when we were signing an exploration agreement and not a production agreement?