Head of the country’s revenue collection agency, Godfrey Statia believes Guyana can renegotiate its Production Sharing Agreement (PSA) with ExxonMobil and its partners operating offshore on the Stabroek Block.
“Any contract that you have is not written in stone. So if for any reason, you would have made a contract and at the point in time when you would have made that contract, you recognised that it was made under those circumstances and [the] circumstances would have changed, you have a right to go and renegotiate,” Statia said.
At a press conference at the GRA’s Camp Street, Georgetown headquarters on Friday, he added that “every country when they have found oil, at some point in the future, have renegotiated.”
The Commissioner-General at the time was being questioned on his views on the provision in the PSA for Guyana to pay ExxonMobil’s taxes.
According to the PSA, the Finance Minister has agreed to pay GRA the contractor’s share of income taxes imposed by the laws of Guyana and other similar charges imposed and payable in respect of Petroleum Operations.
He said as of now the agency is bound by the PSA “unless the PSA changes.”
“If the rules do not change, we cannot change the tax aspect of it,” he added.
Statia noted that there are certain taxes which are not covered by the agreement including the Capital Gains Tax and as such, the company will be liable to these taxes.
He stopped short of saying whether the controversial PSA was a fair one or not, noting that when the elements of the tax are determined and the rate of return among other issues, then the GRA will be able to answer that question of fairness.
Former Petroleum Presidential Advisor, Jan Mangal in an article published by the Kaieteur News on Friday said Guyana can lose US$5B from the Stabroek Block because of the permanent tax holiday granted to ExxonMobil and its partners, Hess and CNOOC.
Additionally, the Stabroek News quoted a letter sent to ExxonMobil by Global Witness –a UK-based international corruption watchdog –calling for the controversial oil contract to be renegotiated.
The Global Witness estimated that Guyana will lose out on up to US$55B over the 40-year period of the license for the Stabroek Block.