Jagdeo’s expositions on depletion policy unbelievable and upsetting – Ram
Kaieteur News-“Unbelievable and upsetting” – that’s how chartered accountant and attorney-at-law, Christopher Ram, has chosen to describe the recent announcement by Vice President, Dr. Bharrat Jagdeo of Guyana’s depletion policy for the extraction of petroleum in the millions and millions of acres. operated by Exxon’s offshore subsidiary in the Stabroek Block.
According to Ram, the policy announced by Mr Jagdeo amounts to no policy – only exploration and abstraction as much as possible within the shortest possible time. He believes that this announcement, made during a radio interview, outside of a more formal announcement that deserves such an issue, must be music to ExxonMobil ears that see Guyana like her cash cow.
Ram said that before the 2020 elections, he had reason to believe that the PPP / C Government would stand on the illegal Petroleum Agreement and in some parts signed by former Minister Raphael Trotman a full year after a world-class discovery on the the sea of Guyana. He now believes, on an objective assessment, that the PPP / C seems to have decided to leave things alone and worse, giving ExxonMobil even more than he has asked for for him, like the hurried Payara production license with no meaningful conditions attached, the glove treatment child from Exxon over his torch, and the removal of the highly qualified Dr. Vincent Adams, who was a thorn in Exxon’s flesh, from Environment.
Noting that it could only be coincidental, Ram pointed to 17 notifications from the Government’s Department of Maritime Administration in newspapers yesterday, some of which only cover the size of the operations area. These notices advise sailors to continue Deep Water Development operations at Liza Field in the Stabroek and Canje Block, to run for all of 2021.
Christopher Ram
In addition, Ram noted that Article 5 of the Exxon Petroleum Agreement provides for part of the area to be surrendered after the end of the first renewal period and that the signal to Exxon from the unlimited exploration and extraction policy may have an effect forestall any meaningful surrender by Exxon when the time comes for such surrender. The accountant who also has a postgraduate degree in Oil and Gas notes that, although under the Minister for Natural Resources Robert Persaud, now back in Government, the Model Petroleum Agreement has been made more attractive nor the 1999 Agreement to Exxon given by the late President Mrs. Janet Jagan. Mr Trotman then exploited and abused this relaxer to the hilt – all in Exxon’s favor.
Ram said that while Jagdeo is an economist by training, many energy economists will have a fundamental disagreement with the logic and rationale for the absence of any depletion policy. While fossil fuel consumption is coming under increasing pressure, coal goes well ahead of petroleum and there is no economic rationale for running down our premium quality petroleum resources. Ram also highlighted that the newly announced policy will de-optimize local content and gave the example of Omai Gold Mines Limited which took around five years to achieve its local content targets within a mandatory agreement covering a relatively small geographical area and activity.
Ram said that the PPP / C may not have paid enough attention to oil and gas between 2015 and 2020 and suggested that the Government now reflect on the need for a comprehensive Petroleum Policy given Article 149 J of the Constitution, limitations of the Constitution Petroleum Exploration and Production Act and Regulations, local content, absorptive capacity of the economy, Dutch Disease, general curse of resources and the urgent need for a petroleum regulatory body, among other things.