Despite Exxon’s controversial relations with some nations … Guyana will not be a walkover
Mar 13, 2017 , http://www.kaieteurnewsonline....l-not-be-a-walkover/
– Greenidge
By: Kiana Wilburg
Even though there have been reports about the “questionable” operations of Exxon Mobil in other territories, Minister of Foreign Affairs, Carl Greenidge is confident that “Guyana will not be a walkover.”
In a recent interview, Greenidge said that many members of the Government have had experience in dealing with multinational companies worth billions of dollars.
He said that based on that experience, valuable lessons were learnt. As such, Greenidge said that the Government is fully aware of how it must approach USA oil giant, Exxon Mobil, to get the best results for Guyana, while complying with the principles of transparency and accountability.
The Vice President said, “When ALCAN, a Canadian mining company and aluminum manufacturer and REYNOLDS, a bauxite company, were operating here, they operated in times when companies felt that they did not even have to answer to the government. And that’s especially if they were North American. But we learnt a lot of lessons of what to do and what not to do…”
With that in mind, Greenidge said that Guyanese have no reason to get “unnecessarily agitated” when it comes to Exxon Mobil.
“Listen, we are interested in transparency and we are not going to be a walk over. Exxon Mobil, in the period which we have been dealing with them, can account for the payments made to the government and we would be able to have that information.”
The former Minister of Finance said he is satisfied that Guyana will get the cooperation of Exxon and it will adhere to the requirements set out by the Extractive Industries Transparency Initiative (EITI).
“We are confident that they are going to be supportive,” Greenidge optimistically asserted.
With the coming of an oil sector that is expected to bring Guyana great wealth, the Government of the day has been paying close attention to the mistakes made by other nations such as Trinidad and Tobago.
However, some anti-corruption advocates are also urging that perhaps the coalition administration and even the citizenry would be wise to pay keen attention to the case of Nigeria and Exxon Mobil.
Shedding a light of transparency on this matter is the Global Witness (GW). This is an international organization that conducts in-depth investigations in an effort to expose and fight off corruption in the environmental sector. It also exposes the abuse of human rights.
The body documented its findings between Nigeria and Exxon Mobil in a report titled Probe into murky ExxonMobil deal, which shows why strong U.S. transparency rules are needed for oil companies.
The report said that a major oil deal which was inked between ExxonMobil and the Nigerian Government is being investigated by Nigeria’s Economic and Financial Crimes Commission (NEFCC).
According to the Global Witness, the probe centres on a controversial deal agreed to by ExxonMobil and the Nigerian Government in 2009 to renew three lucrative oil licences, which at the time accounted for around 25 percent of Nigeria’s entire oil production.
The Global Witness said that ExxonMobil reportedly agreed to pay US$600 million to renew the licences and to construct a power plant at a cost of US$900 million to the company.
However, documents seen by the Global Witness indicate that the Nigerian Government may have valued the licenses at $2.55 billion, and that the Chinese oil major Chinese National Offshore Oil Corporation (CNOOC) offered to pay $3.75 billion for the same licences – over six times the amount reportedly paid by ExxonMobil.
In Nigeria alone, an estimated US$400 billion in oil revenues has been lost to corruption and mismanagement since 1960.
According to the Global Witness, media reports state that Rilwanu Lukman, Nigeria’s senior Oil Minister at the time of Exxon’s deal, refused to endorse the agreement, stating that in his opinion, the US$600 million renewal fee was too low and would deprive Nigeria of the full benefits of the licences.
The Global Witness said that the difference between Exxon’s reported renewal fee and CNOOC’s counter-offer of US$3.75 billion is more than Nigeria’s entire health and education budget combined.
Global Witness approached ExxonMobil with a request for comment on the Nigerian deal. According to GW, the US Company stated that following extensive discussions with the Nigerian Government to renew the licences, an agreement was reached and legally executed.
In reaching the agreement, ExxonMobil fully complied with Nigerian law.
GUYANA’S APPLICATION
With the emergence of a multibillion-dollar oil sector, the government is of the belief that EITI is necessary. As such, it is doing everything possible to safeguard the earnings from oil and gas by working to fast track Guyana’s application to EITI.
The Government’s action in this regard is spurred particularly by the declaration of significant oil finds by one of the richest American oil companies in the world, ExxonMobil.
Should Guyana become a member of EITI, it will be required to ask all companies in the extractive sector, including Exxon Mobil, to reveal what it is paying the government, among other things.
While there are a few more stages left to go through, Guyana certainly made significant headway recently as it relates to its application for membership to the EITI with the launching of Guyana’s very own Multi-stakeholder Group (MSG). This is one of the requirements for Guyana to make it into the EITI fold.
Speaking to the importance of the initiative, Dr. Rudy Jadoopat, National Coordinator of Guyana’s EITI Secretariat, said that EITI brings together a number of groups.
He said that these include oil and gas companies, representatives of government, local and international stakeholders and assessment management companies.
The National Director stressed that the objective of the EITI is to bring international and acceptable standards for transparency to the oil, gas and mining sector.
The National Director said: “EITI creates opportunities for the building of trust among stakeholders and indeed the community at large.
“Companies are required to disclose what they pay to government and the government must in turn disclose what receipts from the companies are made.”
“These figures are then compared to discover any discrepancies, and the information made public as a way to foster public scrutiny and greater accountability over natural resource profits earned by governments…”
The Director said, too, that Guyana has already satisfied a number of requirements. However, there are still a few steps which need to be completed. These include adapting the terms of reference of the MSG, determining the materiality and scope, to review and finalize a draft work plan, to prepare a communication strategy and plan for it, to review and ensure the finalization of the scoping study which was commissioned and prepared by a consulting firm etc.
The National Director assured that the Secretariat will provide support to the MSG.
