The Change Guyana and the Liberty and Justice Parties have indicated their intentions to renegotiate the oil contracts for months now. The PPP had a stance where it would renegotiate all oil contracts except the Stabroek Block contract. In a Stabroek News article published on February 4th titled, “Gov’t urged to renegotiate bad Exxon deal”, it stated, “Both government and the opposition PPP/C have both publicly maintained that they are not open to renegotiating the agreement.” But in an interview on the Guyanese Critic Facebook show on February 26th, the PPP presidential candidate, Irfaan Ali says that all oil contracts are on the table for review and renegotiation. This is a change in position in just a few short weeks.
The Guyanese Critic interview of Irfaan Ali can be found at this link, https://www.facebook.com/GuyaneseCritic/videos/620064495445066/?t=3288. The renegotiation question by Guyanese Critic and the answer by Irfaan Ali with regard to all oil contracts starts at approximately minute fifty five of the video.
Meanwhile it has been well publicized that Guyana is losing US$55 billion dollars on our crown jewel, the Stabroek Block. The US$55 billion amount is based on Guyana’s share of the oil revenues being 69%. The Global Witness report cites an IMF survey that says the typical government share from oil revenues is in a range from 65% to 85%. The average of 65 and 85 is not 69 but 75. Thus even US$55 billion may underestimate the loss on our light sweet crude that doesn’t have to pass through hostile waters like the Strait of Hormuz. Our oil is above average from several aspects such as quality and ability to transport it safely and quickly to its destination. If we compute our loss on an 85% share that works out to US$106 billion.
It would seem logical that the PPP would change their stance on the renegotiation of the Stabroek Block. But it begs the question why has the current Coalition government refused to change its stance on renegotiation of the Stabroek Block? With US$106 billion at stake: that is enough to give each of the 780,000 Guyanese US$136,000. That is more than sufficient to buy food and clothing for the hundreds of thousands of Guyanese that live on US$2 a day.
Darshanand Khusial on behalf of OGGN