The Road to First Oil - ChrisRam.net

December 21, 2018December 29, 2018

Every Man, Woman and Child Must Become Oil-Minded (Part 67)

Introduction

“You couldn’t do the math”, said Ambassador Perry Holloway in his interview with reporters published in Stabroek News last Tuesday December 9, 2018 as he exhorted us Guyanese to educate ourselves about the fortune coming our way from ExxonMobil’s oil. Let us allow the man the slack to exult that it was under his watch that a giant American company discovered some of the largest oil finds in the past ten years; that the 2016 Petroleum Agreement signed by the APNU+ AFC gave to the Americans in Guyana’s Maritime Zone an even better version of China’s Belt and Road Plan without even one Dollar or Yuan given by the US Government in loan or grant to the people of Guyana.

But we need to draw the line when exultation turns to condescension and Guyanese are told they cannot count, or as the departed Ambassador said, “do the math.” Well, I have news for the Ambassador: it is he who cannot count and who appears to be uninformed about the terms of the 2016 Agreement.

It is more than a joke that English was too hard and so the Americans created American “English”. Now it seems their math is poor as well, even as their Ambassador criticises us. But we should not be too hard on the poor man as he is no different from the rest of his countrymen and women: America is not among the top twenty-five countries in the world in math and science.

December 14, 2018December 18, 2018

Every Man, Woman and Child Must Become Oil-Minded (Part 66)

Introduction

Mr. David Patterson, Minister of Public Infrastructure, offered a commendably prompt but strange response to last week’s column by way of his December 8 letter to the editor “The 2019 budgetary allocation has nothing to do with natural gas”. Strange because Mr. Patterson appears to have set out to contradict the statement in Column 65 that it was unclear how an ocean floor mapping exercised announced by him will cost and where it is provided for in the 2019 Budget. Having agreed that there is no budgetary allocation, in compliance with the Constitution, there can be no such activity in 2019.

But Mr. Patterson adds further confusion to the matter by seeking to deny that he spoke with Stabroek News regarding statements on any ocean floor mapping exercise, provoking a direct response from the editor of the Stabroek News that one of its reporters did in fact speak to Minister Patterson for the purposes of the article. It is surely very troubling that Mr. Patterson, a senior Minister, can be so careless and forgetful that he cannot recall a matter as significant as this.

December 7, 2018December 29, 2018

Every Man, Woman and Child Must Become Oil-Minded (Part 65)

Introduction

Today’s column carries out a commitment I made in a letter earlier this week responding to a statement by Mr. David Patterson, Minister of Public Infrastructure appearing in the last Sunday Stabroek. Patterson reports that a Dutch company will be undertaking an ocean floor mapping “as government prepares to bring natural gas onshore”.

In my response, I said that it was unclear how much this mapping will cost and where it is provided for in the Budget. After reviewing the 2019 Estimates, I noted that the closest such an activity came to being a project was described on page 467 of Volume 1 of the Estimates as an Energy Matrix Diversification Programme for which there is an allocation of $600 million for provision for studies and distribution infrastructure in the capital budget of the Ministry of Public Infrastructure.

I have since compared the 2019 Estimates with that of 2018 and it is interesting to note that the Project Code for the description is 2609800 which is a new Code and which therefore, did not appear in the 2018 Estimates.

November 23, 2018December 29, 2018

Every Man, Woman and Child in Guyana Must Become Oil-Minded (Part 64)

Introduction

Figures contained in the 2017 financial statements of Esso Exploration and Production Guyana Limited indicate that the three-party set up of Esso, Hess and CNOOC Nexen will spend well over five hundred billion dollars ($500,000,000,000) up to December 2019. The three companies signed a sweetheart deal with then Minister of Natural Resources Mr. Raphael Trotman one year after Esso’s parent ExxonMobil had announced the world’s largest oil find in 2015.

Put another way, if US$10 (approximately $2,100) of this sum is applied to every barrel of oil, it will require over two hundred and forty million barrels of oil before the full sum is recovered. On the more positive side, once these costs, which are recoverable costs under the 2016 Agreement, are recovered, only ongoing capital expenditure and operating costs will be charged to cost oil for the remaining 4 billion barrels of oil.

November 16, 2018December 29, 2018

Every Man, Woman and Child in Guyana Must Become Oil-Minded (Part 63)

Introduction

It has been nearly a month since the last column appeared on October 19 under the title Complex for the White Man, Disdain for Locals. Recent developments have lent an aura of prescience about that column as we witnessed and contrasted the arrogance and unlawful behaviour of Minister David Patterson to the Berbice Bridge Company Limited, to the “softly, softly”, overly respectful attitude to ExxonMobil by the Government. The Government’s apparent obsession with the Ramroop Group’s involvement in the Bridge Company blinds it to the fact that there are more than twenty other domestic investors in that company, including Pension Schemes, Trade Unions, financial institutions and commercial operators. In fact, the single majority interest in the Bridge Company is held by the National Insurance Scheme while the Chairman of the Board of the Bridge Company is the Chairman of the NIS!

Of course, I believe that the Company was ill-advised to announce its unrealistic, uneconomic and unpopular toll increase. And of course, I believe that there were features of the Bridge Concessions that were too generous to the bondholders who were paid interest which was difficult to sustain and which in fact appears to have been a major contributor to the cash flow difficulties which led to the government’s intervention. I believe too, that the request by the directors for a two decades extension to the concession period was unnecessary, and played into the hands of the Government which has failed to keep its promise to drastically reduce tolls. Continue reading “Every Man, Woman and Child in Guyana Must Become Oil-Minded (Part 63)”