Cabinet has moved past Exxon/GoG contract – says Finance Minister

The current contract between Guyana and ExxonMobil can be used as a baseline for negotiating future agreements, however, Cabinet has moved past this contract, says Minister of Finance, Winston Jordan.

Guyana is expected to receive a two-percent royalty on gross earnings and 50 percent of the profit oil when production begins in 2020.

Speaking at a press conference on Monday, the Minister hinted that if he is displeased with the agreement which was approved by Cabinet, he would have to resign.

“It is not for me to be happy or unhappy. Once Cabinet has approved a document of whatever, collective responsibility, collective responsibility,” he said.

Jordan added that “if you don’t like something and passionate about it, you have the option to resign. So you not gonna ask me whether am happy or unhappy and so on. I’m saying to you it’s known to Cabinet, being discussed by Cabinet, been received by Cabinet and it been approved by Cabinet so, at the level of Cabinet, we’ve gone beyond that.”

However, he noted that the contract was inherited from the past Government and there is no basis for renegotiating the contract. “You make an assumption that we renegotiated the contract that we inherited from the previous Government. No.” he told reporters.

It is his view that renegotiating can affect future engagements but the current contract can be used as a baseline for future engagements. “What will happen to commerce and international transaction if you think that somebody wakes up tomorrow and say ‘oh we get rob and so on, we want to negotiate the contract and so on’?” he questioned.

The Minister has been among a team who visited ExxonMobil Gas and Power Marketing Co. at the ExxonMobil Campus in Houston, Texas, USA.

At the briefings, the Ministers were provided with updates on developments with the Liza Phases 1 and 2. Phase 1 is scheduled to commence in 2020 to recover approximately 500m barrels of oil at a rate of 120,000 barrels per day (bpd) and phase 2 is expected to recover the remaining resource in the Lisa field in 2023 and beyond.

The Ministers were also briefed on, and engaged in, discussions on the advancements of the proposed project to utilise available natural gas for energy generation by GPL and scrutinised the various financial and fiscal models that will emerge from oil revenues in the post-2020 period.

Several Ministers had attended similar briefings in 2016, and it was decided then, to have annual engagements of a comprehensive nature in preparation for ‘first oil’ in 2020 and beyond.