Guyana has signaled that Venezuela’s recent statements on the ongoing border controversy, including attempts to undermine Guyana’s bid round, are a threat to peace in the region.
The Venezuelan government has criticised Guyana’s decision to hold a licensing round for offshore oil blocks in areas Venezuela covets. Accusing Guyana of violating international law, Venezuela warned against any “illegitimate exploitation” and promised to “apply all necessary measures” against companies taking part in the bid.
Even as its behaviour has driven investors away from its own jurisdiction, the Venezuela government’s statements threaten to undermine Guyana’s bid round by preventing investors from taking root there.
Guyana has firmly refuted Venezuela’s claims, asserting its sovereign rights to conduct economic activities within its territory. Dr. Mohamed Irfaan Ali, the President of Guyana, emphasized that Guyana has the exclusive right to exploit resources in the waters as they form part of its Exclusive Economic Zone.
In a more recent statement, Guyana underscored that Venezuela’s threats to take action are about more than just Guyana. “Guyana considers this a threat not only to Guyana but to regional and international peace and security, as well as to all of Guyana’s current and potential investment partners,” the government stated.
Guyana has called upon Venezuela to respect the United Nations Charter and the Charter of the Organisation of American States (OAS), both of which prohibit the use or threat of force against another state. To find a resolution to the territorial controversy, Guyana has sought the intervention of the International Court of Justice (ICJ).
The unfolding drama comes against a backdrop of promising growth in Guyana’s oil economy, with the recent bid round witnessing participation from major industry players like ExxonMobil and TotalEnergies. Despite the controversies, Guyana is determined to move forward with its offshore oil ambitions, with contracts expected to be awarded by November 1, 2023.
Guyana has done a lot of work to make itself a stable and accommodating destination for oil investments. Venezuela, on the other hand, has a troubled history. The Bolivarian Republic has been brought to arbitration by ExxonMobil and Chevron over its disregard for contract sanctity, over billions of dollars in claims. Venezuela is now seeking a lifting of United States sanctions against it, to allow increased partnerships with international investors, including oil companies. Guyanese analyst Joel Bhagwandin has posited that Venezuela’s story serves as a cautionary tale for Guyana as it seeks to build out its oil sector and preserve the sanctity of its contracts.
