Guyana: The Ministry of Foreign Affairs has condemned reports carried in Venezuelan press regarding the approval of a new resolution approved by the Energy and Petroleum Commission of the Venezuelan National Assembly (19.03.2017)

It has come to the attention of the Government of Guyana through a media report in the Venezuelan publication El Nacional of 15th March 2017 that a resolution of the Energy and Petroleum Commission of the National Assembly of the Bolivarian Republic of Venezuela entitled ‘Approved Agreement to Reject Oil Operations in the Essequibo’ has called for the immediate cessation of on-going offshore oil exploration and exploitation activities under Guyanese license in the Stabroek concession block well within the maritime Exclusive Economic Zone of Guyana in accordance with international law. So far as the Government of Guyana is aware, the Government of Venezuela has not adopted or otherwise endorsed the resolution, in which case the Government of Guyana would respond as appropriate.

The inflammatory resolution contains serious factual and legal errors. First, it suggests erroneously that the offshore activities in Guyanese waters have “recently” commenced whereas the Stabroek license was awarded in 1999 and exploration commenced the following year in 2000, 17 years ago. Second, it suggests erroneously that Guyana is prohibited from developing its resources in this area because of Article V of the Geneva Agreement of 1966. But nothing whatsoever in the terms of that provision indicates that the parties cannot exercise jurisdiction over their sovereign territories. Otherwise, it would mean that for the past fifty years, Guyana had no right to develop 70% of its territory, and the same applies to Venezuela’s development of the Orinoco region and adjacent maritime area which, like the Essequibo, was the subject of the 1899 Arbitral Award. Needless to say, such an argument is manifestly absurd.

This political posturing comes at an unfortunate time when the UN Secretary-General has appointed Ambassador Dag Nylander as his Personal Representative to provide Guyana and Venezuela a final opportunity to resort to the Good Offices process in order to resolve the controversy arising from Venezuela’s contention that the 1899 Arbitral Award delimiting the land boundary between Guyana and Venezuela is “null and void”. The parties have until the end of 2017 to make significant progress in arriving at a final resolution of the controversy failing which the Secretary-General will refer the matter to the International Court of Justice. Guyana is fully committed to the search for a full and final resolution of the controversy under the Good Offices process in the limited time that remains. Such deliberate provocations and absurd demands that Guyana halt all development activities, especially when for over fifty years Venezuela has intimidated Guyana and obstructed a resolution of the controversy in accordance with international law, only serve to undermine this final opportunity for the parties to once and for all bring an end to this matter by agreement, failing which adjudication will be the only remaining means of settlement.

Guyana remains committed to friendly and neighbourly relations with the Government and people of Venezuela, but it will categorically refuse to surrender any of the sovereign rights to which it is entitled under international law, not least in this, the fifty-first anniversary of its independence from colonial rule, as a new period of prosperity awaits its people.

Ministry of Foreign Affairs
March 17, 2017

Press and Publicity Unit
Ministry of the Presidency

A look into the Exxon Mobile offshore adventure in Guyana!

There been in the works for years about offshore drilling on the outside of the coast of Guyana. This has been well-known and is internationally known, as before the drilling the start. There was made arrangement between Exxon Mobile and Republic of Guyana. Therefore the squabble of the sea-bed and the ocean with Venezuela and Guyana… shows that both nations knew the value, as even at one point the Suriname could have showed with aggression of force towards Guyana. This was in the calculation of the United States Oil Company. Exxon Mobile was aware of this even in the 1990s and therefore before the boarders of the sea nd the republics right of the possible offshore adventure, the company had assessed the possible problems ahead. That shows how far this company goes to get massive profits. This is one of the Standard Oil babies, therefore the Exxon Mobile has a history and that repeat itself. Even Rex Tillerson the newly appointed State Secretary in the Trump Administration had something to do with newly forged deals with the Guyana republic. As the Republic of Guyana, also difference in value of the oil reserve between 2016 and 2017 is staggering. That the oil value goes from $70bn in 2016 instead of $200bn in 2017. This shows the proof what is coming and what the state can benefit from the oil drilling. Take a look!

Tillerson in Guyaya:

“Rex Tillerson was scheduled to meet with Guyanese President David Granger at mid week to discuss ExxonMobil’s humongous oil and gas find of the country’s Atlantic coast back in May of last year. He was due to arrive late Tuesday” (…) “Oil Minister Raphael Trotman says every effort is being made to avoid this. Legislation which had catered mostly to deal with exploration rather than production is being updated, local content clauses requiring companies to hire locals and buy local will be included and professionals are being scrambled for overseas training in areas including petroleum law” (…) “Trotman has also said that a big chunk of revenues from the first few years of production — expected to commence around 2019-20 — will go to Exxon, meaning that Guyana “would be getting hundreds of millions of dollars but once that phased is passed we are taking about billions annually. At today’s prices the Liza find is worth about $70 billion dollars” (Wilkerson, 2016).

By law in Guyana Parliament:

“This Order may be cited as the Petroleum (Exploration and Production) (Tax Laws) (Esso Exploration and Production Limited, CNOOCNexen Petroleum Guyana Limited and Hess Guyana Exploration Limited) Order 2016” (…) ““Agreement” means the Petroleum Agreement between the Government of Guyana of the one part and Esso Exploration and Production Limited, CNOOCNexen Petroleum Guyana Limited and Hess Guyana Exploration Limited of the other part dated 27 June 2016 concerning the Stabroek Block, Offshore Guyana, which is a production sharing agreement” (Guyana, 2016).

Agreement in 1990s:

“Esso Exploration and Production Guyana Limited (EEPGL) has a Production Sharing Contract with the Government of Guyana dating back to 1999, which now covers 26.8k km2 in the Stabroek block, following required acreage releases (Figure A.1). In 2014, Hess (30%) and Nexen (25%) farmed in to the block. In May 2015, EEPGL announced a significant discovery of high-quality oil-bearing sands with the Liza-1 well (approximately 190 km [120 miles] offshore Guyana)” (Esso, P: 1, 2016).

Staboek oil drilling:

“The FPSO will be designed to receive full well stream production and process oil at a design rate of 100,000 Barrels of Oil Per Day (BOPD) annual average, with the ability for sustained peaks of up to 120,000 BOPD, and a minimum oil storage capacity of 1.6 million barrels of oil. It will be designed to remain on station continuously for at least 20 years. Production and injection wells will be tied back (i.e., connected) directly to the FPSO via flowlines and risers. Umbilical(s) will provide power, control, and subsea chemicals to the drill centers” (…) “At peak production during Phase 1, the FPSO will offload up to 1 million barrels of oil to a conventional tanker approximately once every 10 days using an industry proven FPSO tandem offloading configuration. The conventional tanker will be held in position with the assistance of tug(s) to maintain a safe separation distance of approximately 120m from the FPSO” (Esso, P: 8, 2016).

Plan for Decommissioning:

“At this time, the expectation is that the SURF components would be detached from the FPSO and abandoned-in-place on the sea floor, consistent with standard industry practice. Risers and umbilicals would be flushed before being abandoned and wells would also be plugged and abandoned. For each well, cement and mechanical barriers would be used to secure the well casing and isolate the wellbore from the formation. A cement plug would also be set near the mudline surface to cap each well. The FPSO is expected to be towed away” (Esso, P: 11, 20016).

Waste Production:

The new report of 2017 has more details into the production offshore of Guyana. There are certainly new aspects of the oil drilling. Where the environment get a little bigger aspect as even the changes of environment get a few more fleshy details:

“Air emissions resulting from the Project have the potential to change ambient air quality in the Project Area of Interest (AOI) on a localized basis. Potential impact of greenhouse gas emissions from the Project on climate change” (…) “Subsea sound could cause impacts to sensitive marine fauna (e.g., whales, turtles, and fish) in the PDA” (…) “The Project will disturb marine geology and sediments on a localized basis in the PDA and could impact sediment quality from non-aqueous base fluid (NABF) on drill cuttings discharges” (…) “The Project could potentially impact beaches, mangroves, and wetland habitats in the Project AOI as a result of non-routine, unplanned events” (…) “The Project has the potential to adversely impact cultural heritage through localized disturbance of archaeological or historical sites related to Project development. These resources have conservation, cultural, and other values to stakeholders” (Esso, P: 14-17, 2017)

So with this in mind the government has even had a workshop in February this year. So that the Exxon Mobile Corporation and their drilling and offshore petroleum in the sea of Guyana. The whole deal and agreement between the nation and the business is not clear to the public, except that the business is supposed to be licenced for the drilling and give tax-monies of the production. The Exxon Mobile has already proven that they don’t build a refinery, so the export from the platform to the specialized boats to transport petroleum. Therefore the meeting in Jamaica, Kingston, shows the ability to speak with the ones that starting industry in the South American Nation:

“A HIGH-LEVEL team of Government officials was on Wednesday morning briefed by ExxonMobil on its production preparations, a move which marks the commencement of a series of consultations by the U.S. oil giant with stakeholders.The technical briefing was held at the Marriott Hotel, Kingston and a similar exercise was also expected to be carried out later in the day with a team led by Opposition Leader, Bharrat Jagdeo” (…) “The report stated that early, rough estimates by experts of how much recoverable oil Guyana could have range to more than four billion barrels, which at today’s prices would be worth more than US$200B.

In addition to the Liza field, Exxon and drilling partner, Esso Exploration and Production Guyana Limited are also exploring the Payara field, which is part of a block of 6.6 million acres. On January 12, Exxon announced that its drilling partner encountered more than 95 feet (29 metres) of high-quality, oil-bearing sandstone reservoirs at Payara. It said that the area was safely drilled to 18,080 feet (5,512 meters) in 6,660 feet (2,030 metres) of water” (Solomon, 2017).

So the plans of drilling are set and the anticipated waste is happening as well. That Exxon Mobile will make a killing on these fields in pure and true. The massive reserves will surely make the government of Guyana happy as they even got settled who owned the waters between them and Venezuela.

There are so many more things to come as the proof of the environmental problems and the financial implications is also coming to the forefront with the different values in 2016 and 2017. Exxon Mobile has been hands on and used all means, even foreseen the implications of their activity in Guyana, as they we’re even embedded with the government before the drilling and before the settlement and lawful judgement on who could licence the sea and offshore areas was put in order. Even decades before and therefore the problems with Venezuela and Surinam over who owns it, shows the true levels of planning that the Oil Corporations does. That the Exxon Mobile leadership does what it takes to get giant petroleum reserves. Like the Standard Oil did in the past, so does it future clone Exxon.

We can just follow and wonder what this will lead too and what sort of ways the state can get the funds and resources into the consolidation funds, not to speak of in use for the citizens of Guyana. Not only the elite and the central leadership as so many petro-dollars have ended at. Let’s hope that the Guyana Republic and their leadership can sustain the offshore adventure and also give it back to its citizens. Peace.

Reference:

Esso Exploration and Production Limited Project – ‘SUPPLEMENTAL INFORMATION TO THE APPLICATION FOR ENVIRONMENTAL AUTHORISATION FOR EEPGL’S LIZA PHASE 1 DEVELOPMENT, STABROEK LICENSE AREA, OFFSHORE GUYANA’  (8/2/2016) “ESSO EXPLORATION AND PRODUCTION GUYANA LTD”

Esso Exploration and Production Guyana Ltd – ‘PROJECT SUMMARY FOR LIZA PHASE 1 DEVELOPMENT, STABROEK LICENSE AREA, OFFSHORE GUYANA’ (January 2017)

Memorial of Guyana – ‘Exxon signs PSC for Deepwater Acreage off Guyana; Adds to Global Deepwater Portfolio’ (14.06.1999).

Guyana: ‘THE PETROLEUM (EXPLORATION AND PRODUCTION) ACT – IN EXERCISE OF THE POWER CONFERRED UPON ME BY SECTION 51 OF THE PETROLEUM (EXPLORATION AND PRODUCTION) ACT, I MAKE THE FOLLOWING ORDER’ No. 10 of 2016 (2^nd August 2016).

Solomon, Alva – ‘Oil Brief –Exxon briefs Gov’t, Opposition on preparations for oil production’ (01.02.2017) link: https://guyanachronicle.com/2017/02/01/oil-brief-exxon-briefs-govt-opposition-on-preparations-for-oil-production

Wilkinson, Bert – ‘Tillerson scrubs Guyana visit’ (15.12.2016) link: http://www.caribbeanlifenews.com/stories/2016/12/2016-12-16-bw-tillerson-trump-pick-cancels-guyana-visit-cl.html

Letter from NRM Youth in Kabale to Mzee/ State House Entebbe: “Re: Petition of the Conduct of the RDC and Deputy RDC Kabale (25.01.2016)