Jagdeo insists Gov’t not changing ‘core’ terms in new oil contract to satisfy Exxon

The government will not change any of the core fiscal terms of the new oil contracts because it believes that these requirements are competitive and not onerous, Vice President Dr. Bharrat Jagdeo said on Thursday.

The Vice President reminded that the new Production Sharing Agreements (PSAs), commonly called the oil contracts, and the new Petroleum Activities Act were crafted with public input.

He said the government worked with a competent international firm to create the new agreements in a way that maintains competitiveness while generating increased benefits for Guyana.

So, he doesn’t believe any changes to the core, fiscal terms are warranted.

Earlier this week, however, President of ExxonMobil Guyana Alistair Routledge expressed concerns about the relinquishment provisions in the new oil contracts. He said they are “unusually short” and noted that ExxonMobil would not sign an agreement with those existing provisions.

Those provisions, essentially, refer to the portions of oil blocks that would be returned to the government upon renewal after a certain time has elapsed.

Jagdeo did not agree with this and instead said ExxonMobil does not have to sign onto any of these agreements.

“So if they don’t want to sign it, fine, they don’t need to sign it.

“We’re not going to change this PSA and make it the way Exxon wants it,” the Vice President said.

Jagdeo, however, noted that the government isn’t “hard and fast” with the new PSAs but maintained that the core fiscal terms, including the relinquishment provisions, would not be changed.