Oil companies not incorporated in – But all its subsidiaries stand to get big benefits- Ram

Oil companies not incorporated in – But all its subsidiaries stand to get big benefits- Ram

Jan 14, 2018 News, https://www.kaieteurnewsonline...et-big-benefits-ram/

The Petroleum Sharing Agreement that the APNU+AFC government signed is with three other companies. These companies are Esso Exploration & Production Guyana Limited, which is an American company; Hess Corporation, also American; and China National Offshore Oil Corporation, or CNOOC Group which is a major national oil company in China.

Together, these companies are going to start producing oil out of Guyana in about two years. Approximately 450 million barrels of oil will be produced in just the first phase of the Liza oil field development, 120 miles offshore Guyana. Yet, none of these companies have bothered to incorporate a local branch. This was pointed out by Attorney at Law, Christopher Ram.

He recently noted, “A general observation between the two Agreements is that while the 1999 Agreement was with Esso, the 2016 Agreement is with three companies – Esso, Hess and CNOOC, each of which will have Affiliated Companies which can benefit from the concessions and facilities under the Agreement.

“It is also worth noting that none of these three entities have incorporated a domestic company and each has its registered office at the same address – 62, Hadfield and Cross Streets, the same address as Hughes, Fields and Stoby, Attorneys-at-Law,” said Ram.

The concessions under the agreement are vast. The contract states, “After the signing of this agreement and in conformance with Article 15, the government shall not increase the economic burdens on the contractor under this agreement, or by applying to this agreement, or the operations conducted thereunder any increase of, or any new petroleum related fiscal obligation, including, but not limited to any new taxes whatsoever, any new royalties, duties, fees, charges, Value Added Tax or other imports”.

With regards to import duties, the government has committed to ExxonMobil, its partners, and sub-contractors engaged in petroleum operations to waive all duties, taxes and other imports on all equipment and supplies except food and alcoholic beverages. The company is also exempt from paying export duties on such items that have been brought into the country for petroleum operations.

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