December 1, 2020 Read More →

Guyana vice president warns ExxonMobil of potentially criminal behavior

Kaieteur News:

Following the announcement by ExxonMobil and its partners, Hess Corporation, Ratio Petroleum, and Cataleya Energy Limited, that the discovery at the Tanager-1 well in the Kaieteur Block is non-commercial, the companies informed the market that the well would be plugged and abandoned.

Since making this disclosure, however, industry stakeholders have expressed concerns about what protection Guyana has in place to ensure the millions of U.S. dollars incurred to drill and now plug the well would not be billed against the profits being made in the Stabroek Block.

Kaieteur News subsequently contacted Vice President, Dr. Bharrat Jagdeo, on the matter as he is tasked with an oversight role for the oil industry. 

The Vice President was quick to note that if ExxonMobil were to engage in such an act, “it would be criminal.”

During a brief interview with this newspaper yesterday, Dr. Jagdeo stressed that the agreements signed for the Stabroek and Kaieteur blocks are separate.

It therefore means that expenses have to be accounted for separately, expressed the official.

The former President added: “They can’t consolidate everything. We made it clear that when they come for a production sharing agreement for the Kaieteur Block, (it would not have the same loopholes as those which exist in the Stabroek agreement). It would be a very different PSA. So they can’t transfer that or else it would be criminal…”

The concerns about the consolidation of costs were expressed yesterday by Tom Sanzillo, Director of Financial Analysis at the Institute of Energy Economics and Financial Analysis (IEEFA).

Sanzillo is of the firm conviction that the accounting process for the non-commercial well needs to be addressed in a transparent manner while adding that there are serious questions which the citizenry needs to have answered. 

[Staff Report]

More: If ExxonMobil bills Guyana for Kaieteur non-commercial well it would be criminal—Jagdeo

Posted in: IEEFA In the News

Comments are closed.