Nothing in oil contracts bars ring-fencing; PPP/C created all lop-sided contract terms - Kaieteur News
## Nothing in oil contracts bars ring-fencing; PPP/C created all lop-sided contract terms
Jun 14, 2025 Letters
Dear Editor,
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Kaieteur News – It is sickening to look and listen to a daily diet of the PPP/C’s blatant falsehoods suggesting that the terms in the lop-sided oil contracts were created by the APNU/AFC Coalition – a lie perpetrated to cover-up the PPP/C’s spinelessness in not seeking contract renegotiations to make a better deal with Exxon for a fair and just share of our people’s own patrimony. The irrefutable facts presented herein will expose that the PPPC created all of the lop-sided terms for which they now hypocritically vilify the Coalition.
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Fact #1 – To date, there is a total of nine deep-water oil contracts. the PPP/C signed the first seven between 1999 and 2015, followed by the Coalition’s signing of the final two in 2016.
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Fact #2 – The PPP/C created every single one of the lop-sided terms which they put into their original seven contracts and afterwards copied into the two contracts signed by the Coalition, with the only change being to double the PPP/C’s 1% royalty to 2%; but that fact didn’t stop VP Jagdeo from barefacedly lying that the Coalition “gave up a zero royalty”.
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Fact #4 – Notwithstanding the above facts that all contract terms were created by the PPPC, Jagdeo dishonestly imputes the Coalition for “no taxes and no ring fencing”. First, there is absolutely nothing in the contracts stopping the PPP/C from imposing Ring Fencing; but they spread this lie to cloak their unpatriotic subservience to Exxon not wanting Ring Fencing, consequently robbing the nation of our patrimony desperately needed to bring us out of dire poverty, while putting it into Exxon’s pockets. Second, as already established, the “no taxes” term was created by the PPP/C and not the Coalition.
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Despite the above facts that all terms were created by the PPP/C
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AG Nandlall in his characteristic devious way, describes
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016
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as “the most
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and the Coalition
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’t explain sensibly
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Since the Coalition
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s 2016 contract is
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only change being the Coalition
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s doubling the royalty from 1% to
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own standard, Nand
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entered into the
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us in the first place”
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waging war in
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by Janet J
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had only entailed the exploration phase, and so, excluded the lop-sided production sharing terms which were only first introduced by the Coalition in
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separate 2016 production phase contract. On the contrary, there are no separate Contracts for exploration and production. All nine contracts incorporate both the exploration and production phases and the lop-sided
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Unless exceedingly daft
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how could anyone read any of these Contracts and comprehend otherwise
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Clearly evident from all of the foregoing, these fellas, inspired by their Putinesque maxim, want Guyanese to doubt what they hear with their own ears, see with their own eyes, read with their own lips, and think with their own brains, leading to Jagdeo’s insulting utterances that Guyanese are “stupid”. He denies meaning what he said in plain vanilla talk that “They sold us out to the foreigners. Every time there is a find out there, our people should be sad because nothing comes our way. We are going to renegotiate those contracts. They gave up zero royalty, no taxes, no ring-fencing”.
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Though he relishes abusing his own citizens, reporters, and all who dare to fact check him, Jagdeo’s bloviating quickly turned into meek obedience to
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, mousily changing his tune to “sanctity of contract” fearing to even ask Exxon to renegotiate the contracts, leaving no doubt whatsoever as to who really “sold us out to foreigners” and who are the real “crooks and culprits”.
question/article about renegotiating the contract to keep profit share at 39.8%
Davina Bagot · Kaieteur News
There has been an array of public missives about the welcomed oil profit share to Guyana being more than tripled to 39.8%, or approximately G$8 Billion (B) per day at the current production rate and oil price. However, what seems to be missed is that this is unadulterated ring-fencing, proving that contrary to the Govt’s falsity, the contract does not disallow ring-fencing, as yours truly stressed in letter “ Nothing in oil contract bars ring-fencing” published in the broad media including Kaieteur News (KN) June 14, 2025 edition.
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That was the good news, but something seems fishy going on here with lots of questions, signaling that the 39.8% is most likely short-lived as evident by the fact that the numbers do not add up; and by HE President Ali’s head spinning convoluted press conference.
There should be no doubts whatsoever that Exxon notified President Ali of the increase before it made the news, and it goes without saying that any Leader would be jumping up and down shouting from the rooftops grabbing credit and scoring political points for such good news. However, beyond belief, it had to take weeks of public pressure to force Dr. Ali into doing the normal; and when he did, his uneasiness was most noticeable, when, instead of a gleeful announcement, he inexplicably first went on the defensive, taking great pains to lecture us on how the profit share formula works, and being emphatic that the contract was not changed to bring about the increase. Why was this uncalled-for defensive posture?
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behavior begs the
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this just a shrewd business move by
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making enemies of all
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sundry who dare to advocate
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Glen Lall
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fighting for ring-
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Most revealing was Dr. Ali’s disorienting answer to a question from Davina Bagot of KN about whether he will take this opportunity to renegotiate the contract to ensure the profit share remains at 39.8%. Amazingly not prepared for such an expectedly inevitable question, Ali resorted to confusingly speak from both sides of his mouth that he is having “internal discussions” and seeking expert advice how to “get greater benefits” while at the same time spouting his old song and dance of “sanctity of contract”.
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First, despite what VP Jagdeo believes, Guyanese are not stupid, and know fully well that Exxon is the Govt’s only advisor and controller, so the “discussions” start and end how Exxon wants it. Second, how could the President still not comprehend that “greater benefits” beyond ring-fencing can only come with renegotiations which he and his Govt pledge not to do? Third, this is the same Ali and oil czar Jagdeo, who vow to never renegotiate because of “contract sanctity” and cowardly to even raise it with Exxon, though allowed for in Article 32 of the contract; and despite their manifesto promise and their rabid admonition that it is the worst contract ever, so, renegotiation will be of highest priority when in office.
The President now finds himself in a bind knowing that this increase is temporary and would be a hard sell to the people; thus, to soften the blow of this bad news, he slickly comes up with fancy talk about “discussions with experts” for “path forward to get greater benefits”. Notwithstanding Exxon being his only expert and advisor, the President is still advised that there is nothing more to discuss nor think about, since the precedent for ring-fencing has now been set, whether or not motivated by Exxon’s financial interests, and must stay in place. Any drawing of a line at the end of any project is the definition of ring-fencing; so, th ere can be no going back!
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Moreso, the President must demand that this new dispensation be retroactively dated back to the first ring-fencing point in 2022 when the first project (Liza 1) was truly paid off, along with recovery of the 39.8% worth of USD $B owed to the country since that time.
In any case, if the Opex is 20 barrels oil out of each 100 barrels according to the President, it means that the Capex accounts for the other 55 or 73.3% of the 75 barrels of cost oil or cost bank. Thence, the USD $55 B supposedly paid off for the 1 st 7 projects will have been proportionally divided into USD $40 B for Capex and USD$15 B for Opex. However, the Field Development Plans (FDPs) which are the heart of the projects, document a total estimated Capex of USD $61 B. With Exxon’s project management expertise, it is hard to swallow that their estimated Capex could be a whopping 52% higher than the actual costs, unless the Guyana Govt happens to be managing their projects. This looks like something fishy going on here with the people’s money that must be explained.