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An oil rig in the United States pumps crude from shale. (Photo: Forbes)

Guyana’s government rejects bad oil deal report as a “calculated attack”

An oil rig in the United States pumps crude from shale. (Photo: Forbes)

The Government of Guyana yesterday rejected a report by a non-governmental organisation that could lose US$55 billion from an “exploitative” oil deal it signed with Exxon.

An aerial view of Georgetown, the capital of Guyana.

Global Witness, which asserts to challenge corruption in order to protect human rights and the environment, this week said Guyana was pressured to hurriedly renew Exxon’s licence. What’s more, the body said that the country’s Natural Resources Minister, Raphael Trotman, received a “lavish” trip to Exxon’s Texas headquarters to work out the details of the deal which ultimately saw the oil and gas company lift its first shipment of one million barrels of crude oil from the country last month.

In its response, the Government called the claims “arbitrary and utterly absurd”, adding that Global Witness had no basis for its conclusion. The Government went further by saying it thought the report was a “calculated attack” as it headed into an election. “This timing cannot be seen as a coincidence and it appears as though it is seeking to influence the electoral outcome”, it said it a release.

“The report deliberately seeks to trivialise the national security and sovereignty of Guyana.”

– Statement by the Government of Guyana

It deemed the report “sensationalist, agenda-driven and extraordinarily speculative” as “Global Witness presented absolutely no evidence of corruption or malpractice on the part of the Government or its officials.”

Further, the Government said the request for it to cancel its Stabroek drilling licence with Exxon and nine others is “preposterous”. It continued that the Government entered an agreement that was “fair” for Guyana’s people.

Among the benefits of the licence that it listed were a fifty per cent profit from oil, two per cent royalty, withholding taxes, direct employment for 1,900 people in the sector, US$300 million in foreign direct investments so far and a US$18 million signing bonus.

“The Government maintains its position that there were geo-political and national security imperatives which could not be ignored. The report deliberately seeks to trivialise the national security and sovereignty of Guyana.”

The Yannis P lifted the first shipment of oil from Guyana on January 18.

Additionally, it said the report relied heavily on “innuendo and conjecture” and contradicts itself by stating it is not suggesting the trip by Trotman violated US or Guyanese anti-corruption laws. “Global Witness does not allege that Trotman deliberately negotiated a bad deal, or deliberately ignored information that would in fact have got Guyana a better deal”, quoted the Government’s statement from the report.

Guyana’s Natural Resources Minister, Raphael Trotman

As it related to the US$55 billion in potential loss, the Government’s statement said it was “random, arbitrary and highly speculative”.

The Guyanese government said it was time its people enjoyed the right to “self-determination and their own destiny” without the interference of external influences.