As Guyanese and Surinamese both contemplate the implications of the award that has effectively settled the long-standing maritime dispute between the two South American Republics, officials in both George-town and Paramaribo appear optimistic that the demarcation of the maritime jurisdiction of the two countries significantly enhances their respective prospects of economically significant oil finds.
Just hours after President Bharrat Jagdeo’s Wednesday, September 20, announcement in a nation-wide broadcast that the ruling on the disputed maritime zone by the International Law of the Sea (ITLOS) Tribunal had been “very favourable” for Guyana insofar as it validated most of the country’s maritime claims, the Canadian Oil Company CGX Energy disclosed that it was preparing to invest US$15m in new seismic studies in the very area from which, illegally as it turns out, its earlier operations were brought to a halt by Surinamese gunboats in June 2000.
The Guyana Geology and Mines Commission, meanwhile, has also announced that it is anticipating a renewal of interest in oil exploration in Guyana’s maritime space by several companies which, over the years, have shown interest in the country’s oil potential then quietly faded away.
In Paramaribo, meanwhile, both government officials and oil industry spokespersons have made optimistic pronouncements about the outcome of the arbitral award and the prospects that it opens up for the Surinamese oil industry.
A week ago former General Manager of Suriname’s state-owned oil company, Staatsolie, Eddy Jharrap was quoted in a Caribbean Newsbeat story as saying that the award which is binding on both countries and which effectively brings the maritime controversy to an end ought to result in a renewal of interest in oil exploration activities in the area by international companies. Jharap is also quoted as saying that the award was “fair and equitable” and that both countries “got a fair share” of the maritime space.
And while the announcement of the outcome of the deliberations by the Tribunal appears to have met with opposition criticisms of the Venetiaan government’s handling of the legal proceedings that preceded the tribunal’s eventual decision, by contrast the political opposition in Georgetown joined the government in expressing satisfaction over the outcome of the proceedings.
Opposition dissatisfaction over the outcome of the legally binding proceedings, however, appear to have impacted little on the positive official pronouncements that have been emanating from government officials in Paramaribo. According to reports Suriname Vice President Ram Sardjoe has urged Surinamese not to focus on the unfavourable aspects of the award but on those outcomes that were positive for the country’s economic development while Foreign Minister Lygia Kraag-Keteldijk was quoted in the Caribbean Newsbeat story as saying that she was “glad that an end has come to the dispute and that it is clear to everybody where the boundary is.” Foreign Minister Kraag-Keteldjik also reportedly refuted opposition claims that the preparation of the government for the International Law of The Sea (ITLOS) arbitration was poor and that the opposition had not been consulted.
Both government officials in Georgetown and Guyana’s legal team at the ITLOS deliberations – that included Sir Shridath Ramphal who served as Foreign Minister in the former political administration and as Secretary General of the Commonwealth – have treated the outcome as a vindication of Guyana’s maritime claims. For most Guyanese, however, the prospect of a restart of CGX’s oil exploration operations and the likelihood of additional interest by other international oil companies in Guyana’s potential as an oil-producing nation has resulted in no real celebrations. Guyanese have come to understand only too well the disappointments that have come from previous promises of oil that have disappeared with the pulling out of one oil company after another as a result of either Venezuela’s objection to exploration activities in the west of the country or by incidents like the June 2000 expulsion of the CGX rig by Suriname.
The government though has been pursuing a less “cautious” approach to the oil question. As a 2007 outcome of the ITLOS arbitration tribunal appeared more and more likely, the Government of Guyana earlier this year entertained visits from several international oil companies including Exxon, which has already invested in oil exploration in Guyana, Groundstar Resources of the United States and Sadna of Trinidad & Tobago.
Additionally, in the months leading to the announcement of the arbitral award CGX, particularly, has been decidedly positive about Guyana’s oil prospects. In March this year the Company’s Chief Executive Officer Kerry Sully was quoted in a release issued by the state-run GINA as saying that Guyana was ‘exactly the place to be over the next five to ten years.” An article published in the September 27, issue of The Economist magazine has quoted Sully as saying that actual drilling for oil in its Guyana concession was unlikely to begin before 2009.
The Guyana basin is believed to have a proven petroleum system and both CGX and other oil companies believe that the prospects for a commercially viable oil find here are good.
Suriname’s state-owned Staat-soolie has also been preoccupied with both onshore and offshore exploration and drilling activities. Earlier this year the company has concluded an onshore joint venture exploration agreement with Tullow Oil of the United Kingdom while offshore exploration agreements were concluded with Murphy Oil Exploration and Production Com-pany of the United States and the Japanese firm Telkoku. Earlier this year Staatsoolie announced that Suriname would be launching a new round of oil exploration and production initiatives in March next year.