As the government continues to work through the environmental issues plaguing the approval for ExxonMobil’s Payara Field Development Plan (FDP), there have been increased calls for the government to use this opportunity to renegotiate better economic terms for the nation under the Stabroek Block Production Sharing Agreement (PSA). But Trinidadian Energy Consultant, Mr. Randall Mohammed who is based in Dubai, told Guyana Standard that the Operator would not be inclined to consider amending the deal especially at a time when oil prices are low.
In fact, Mohammed contended that given the depressed state of the industry, there is a greater risk with Exxon’s financial strength to continue exploration and production operations in Guyana.
The Energy Consultant said, “If it’s lower for longer (with the) oil prices, it’s going to be hard for Exxon to consider any changes which may reduce its revenue and delay development and production in Payara. Time is money.”
Mohammed added, “This is where the host nation and investor must come together and engage in dialogue about understanding the big picture and long term goals.”
That aside, the consultant reminded that the stabilisation clause in the PSA protects Exxon from renegotiation of the agreed terms hence making a review for the purpose of amending the agreed fiscal terms highly unlikely.