The Global Witness report that shows Guyana has potentially lost US$55 billion from the oil deal with ExxonMobil would have been more effective if it was released after the March 2nd general elections as it could have been used to pressure whichever government wins in its dealings with the oil major, thus helping shape public policy.
So said Chatham House Fellow and Project Head of the New Petroleum Producers Discussion Group Dr Valérie Marcel, who last week told Sunday Stabroek that while she believes that the timing of the report’s release was designed to give the United Kingdom-headquartered non-governmental organisation more prominence and grab global attention, she doubts that Global Witness prefers the opposition People’s Progressive Party (PPP) over the current APNU+AFC coalition government.
“Global Witness wants to effect positive change on the governance of natural resources. I think it would have been more effective to release the report after the elections, so they could use it to put pressure on the winning party to be a stronger counterpart to ExxonMobil. Less of a “gotcha” moment but more, potentially much more effective,” she said.
“Global Witness concludes that both administrations made mistakes with negotiations. From the evidence gathered, Global Witness doesn’t say there was corruption or abuse of power from either administration, though it points to mistakes and areas of concern. Since it isn’t an instance where there is an egregious abuse of public trust by one party to be exposed, I think they should be careful to be more even-handed before such an important election,” she added.
Marcel’s assertion comes against the background of claims by the Guyana government that Global Witness’ release of its report, titled “Signed Away: How Exxon’s Exploitative Deal Depriv-ed Guyana of up to US$55 Billion,” just ahead of the March 2nd general and regional elections, was politically motivated.
“I don’t believe Global Witness has any political reason to favour the PPP over the incumbent government. It is only opportunistic in the sense that it increases the attention their report gets,” Marcel, who advises governments in sub-Saharan Africa, the Eastern Mediterranean, South America and the Caribbean on petroleum sector policy and governance, said.
The Guyana government has said it “views the report as a cunning and calculated attack on a sovereign state with a duly elected Government mere weeks before an election. This timing cannot be seen as a coincidence and it appears as though it is seeking to influence the electoral outcome.”
The government had previously rejected the Global Witness report and has insisted that it had entered a “fair” agreement with ExxonMobil.
Defending the contract, government has said that when it entered office, it found that a 1999 Petroleum Agreement and a 1999 Petroleum Prospecting Licence was due to expire in June 2018 and since the agreement had already been renewed two times, by law it could not be renewed again. Exxon’s exploration work could not be completed before the expiry.
At the same time, the government said, Guyana’s longstanding border controversy with Venezuela was at a critical point. “In May 2015, Exxon announced that it had struck oil, and simultaneously Venezuela issued a presidential decree, stating that Guyana’s maritime area fell within its national waters. The protection of Guyana’s offshore oil and gas activity in the face of military action by Venezuela became an urgent matter of national security,” a full page advertisement last week had stated.
“The coalition government determined that it was in Guyana’s best interest to grant a further extension and in 2016 granted the requisite licence with improved benefits, including doubling of the royalty, higher rent payments and annual payments from Exxon for environmental and social programmes,” it added.
And even as he has maintained that the petroleum agreement’s terms was demonstrative of an inept government, PPP General Secretary Bharrat Jagdeo has rejected claims that his party had any link to the Global Witness report or affiliation with the NGO, which fights against corruption and lack of transparency, especially in the natural resources sector.
Influence
Marcel pointed out that since Global Witness did not uncover any corruption or serious breach of trust that needed to be disclosed, there seemed to have been no convincing or compelling reason to release the report on February 3, 2020 – one month away from polling day.
She said that she is not sure if the Global Witness report will influence the voting populace of this country but pointed out that much of the evidence highlighted in the report had already been exposed by the Guyanese press and in previous financial assessments of the ExxonMobil deal.
The former lecturer in international law at Cairo University said she believes that the handling of the 2016 Production Sharing Agreement was not about corruption, but perhaps more about a government’s lack of understanding of the power it actually had (and has) vis-à-vis ExxonMobil. “The point on corruption was made in a different context. Progress in battling corruption is very important as Guyana starts to produce oil and large revenues come on line,” she said.
And with an extensive work background in new countries with emerging oil and gas sectors, Marcel said she hopes that the government elected on March 2nd is committed not only to combatting corruption, but also to redistributing wealth and opportunities irrespective of political or ethnic groups.
Said Marcel, “It’s important to recognise that this is an issue at stake in elections: Do individual citizens feel they will only have access to the new economic opportunities if “their” party wins?”
To criticisms that her views lean to defending the current government because her organisation was used for consultancy services, she said, “Chatham House and the New Producers Group have been working in Guyana since 2012 and we therefore supported both administrations.”
“This has been the case in all the member countries of the New Producers Group that had a change of government. One reason we transcend politics is because we work with civil servants and because we work for the benefit of the country,” she added.
