Guyana government should show skill in awarding oil concessions

http://www.stabroeknews.com/index.pl/article?id=56529445

Guyana government should show skill in awarding oil concessions
Stabroek News, Sunday, September 23rd 2007

Dear Editor:

While the Guyana government did a stellar job establishing its borders
and securing its mineral wealth, it did poorly in licensing the oil and
gas exploration rights. The licensee with most acerage in Guyana is a
little known and poorly capitalized company, CGX Energy, Inc. The folks
at the Guyana Geology and Mines Department surely know it takes deep
pockets to develop oilfields, on and off-shore, and a poorly
capitalized company like CGX should not have been awarded such large
tracts of Guyana's potential wealth.

The systematic method in which the Guyana government hired advocates
like Sir Shridath Ramphal et al, to present its case against Suriname,
should have been implemented to auction acreage with prospects for oil
and gas exploration and extraction. These funds would have been used
for hiring the technocrats to implement the checks and balances to
ensure the Guyanese people's royalty fees are maximized. The Guyana
government should learn from the Omai debacle - where a lax royalty
regimen did not bolster the coffers of the treasury much, and left a
depleted mine and cyanide-polluted land. Cleaning this cyanide
contamination will cost much more than all the funds paid by Omai to
Guyanese workers and the Guyana government.

The citizens of Guyana, members of the PPP, PNC, AFC and Cheddi Jagan
Jr of UP should ask the tough question: Was there open bidding for the
tracts awarded to CGX Energy, Inc? Was Parliament consulted? The Jagdeo
regime is skilled and smart as shown in its international arbitration
fight against Suriname. Was this same skill used when dealing with the
oil concessions?

Yours faithfully,

Deon P. Edwards

Editor's note

CGX is not the only company to have been awarded concessions. There are
others including Repsol and Exxon.