By Raffique Shah
September 26, 2018
Kamla Persad-Bissessar’s statement that a possible solution to Petrotrin’s problem might be to import crude oil from Guyana was uninformed—and here I’m being charitable to the Opposition Leader. But nothing she said warranted the barrage of insults hurled at Trinidad and Tobago in a response by one Robert Persaud, who is described as being a former Minister of Natural Resources and the Environment in Guyana.
Kamla ought to have known that sourcing approximately 100,000 barrels crude oil per day to be processed at Petrotrin’s refinery is not the problem. The world is awash with crude, and the prices of the various types (light, medium, heavy) are standard, give or take a few cents per barrel. Petrotrin refinery’s big problem, according to the Government, is the cost of processing crude.
Refineries usually make a profit (margin) of US $2-plus on each barrel it processes into diesel, gasoline, kerosene, etc. In Petrotrin’s case, Government says, the refinery was/is losing US $2 per barrel—matters not if the crude comes from Trinmar (a Petrotrin subsidiary), Russia, Ghana or Guyana.
If Kamla had done some basic reading, she would have learnt that Guyana is not expected to start producing oil before 2020.
If she had consulted her former Energy Minister, Kevin Ramnarine, he would have explained that the Guyana Government has signed agreements and contracts that will see ExxonMobil, the oil giant that invested billions of US dollars in exploration that has thus far yielded three billion barrels of proven reserves, recover its investment costs through a 75 percent allocation of revenues over the first four years production, with the remaining 25 percent split evenly between Exxon and the Government.
I should add that oil exploration companies recovering their capital investments from the sale of oil is standard practice worldwide. The difference is the period over which they do it. Also, In Guyana, royalty tax is set at two percent. In T&T, it was as low as 1.5 percent up to 2015, when Government raised it to 10 percent. In the 2017-2018 Budget, Government increased the tax to 12.5 percent.
Guyana’s Natural Resources Minister Raphael Trotman said initially, from the Liza 1 well, Guyana will receive revenues of approximately US $300 million a year, with projections of US $7 billion over its 20-year lifespan. Using US $50 per barrel as an average oil price, the 3.2 billion barrels thus far discovered are projected to earn Guyana revenues of US $80 billion “in years to come” according to Trotman.
That’s a huge sum of money for a country whose per capita GDP in 2015 was a mere US $4,000, in contrast to T&T’s US $17,000. But we know only too well how such wealth can be both a blessing and a curse. We can only hope that the governments and people of that sister Caricom country will use it wisely to the benefit of its citizens, the majority of whom have experienced economic hell for far too long, and for future generations whose patrimony it is.
This brings me back to ex-minister Persaud, who, if news reports on his insulting remarks are accurate, is an ugly example of “oil dollars polluting the brain”.
Responding to Kamla’s suggestion that T&T buy (not borrow or steal) crude oil from Guyana, Persaud said: “…Do not look to Guyana to bailout (sic) a failed enterprise -Petrotrin refinery. Your track record as PM, in relation to treatment of Guyanese and trade in Guyanese products, is appalling as your predecessors and successor. Guyana’s oil and gas industry…should not be TT or anyone’s next meal,..
“…Do remember none or even limited opportunities were given to Guyanese during TT’s 110 years plus as an oil and gas producer. Guyana will neither be the bogey-man in your political gambits nor be allowed to be only the convenient rainy-day friend because we are to be the next largest oil and gas economy of the Caribbean…”
Clearly, Persaud has had T&T and Trinis “in his craw” for a long time, and now that he sees oil dollars on Guyana’s doorstep, he is venting his venom, branding us beggars he would spit (or sh*t) upon.
No way, fella!
Others have reminded you that between 1974 and 1995, T&T loaned Guyana approximately US $500 million that your government could not repay—in cash or kind. T&T wrote off that debt, forgave Guyana, and our generosity, our humaneness registered us as the smallest country in the world to extend such kindness to a neighbour in distress.
You claim that T&T has always treated Guyanese people badly, discriminated against them: what “tatah”. I’m sure many Guyanese encountered problems with our Immigration officers, but I’m also sure such experiences were no different to those encountered by Jamaicans and other Caricom nationals.
In fact, I boldly say that more than 100,000 people of Guyanese origin, many still officially nationals of that country, live happily in T&T, enjoying all benefits our citizens do (education, health, job opportunities, etc). Outside of Canada and the USA, T&T is home to the largest Guyanese diaspora.
I should add too, for the edification of ingrates like Persaud, that since 1973, T&T has been the biggest contributor to CARICOM, which is headquartered in Guyana, hence providing more jobs for Guyanese than Trinis. We have also contributed more funding than any other member-state to regional institutions like the Caribbean Development Bank and the Caribbean Court of Justice.
Finally, Persaud, T&T is indeed navigating rough economic seas, and we cuss each other, more so our politicians, over this tragic state of affairs. But we, not you, are free to do that.
Don’t let the oil addle your brain: we are not paupers or beggars—never will be.