𝗞𝗲𝘆 𝗜𝗻𝘀𝗶𝗴𝗵𝘁𝘀
• The weak fiscal regime for oil originated in the PNC’s 1986 Petroleum Act, not under PPP/C.
• The 1999 Exxon license and the 2016 PSA flowed directly from this PNC law, with APNU+AFC adding a stability clause in 2016 that froze fiscal terms.
• PPP/C could not unilaterally renegotiate without destroying Guyana’s credibility and exposing the country to massive penalties.
• Instead, PPP/C overhauled the legal framework—repealing the 1986 law with the Petroleum Activities Act (2023) and enacting the Local Content Act (2021).
• Under the new framework, future contracts guarantee stronger terms: 10% royalty, 10% corporate tax, 65% cost recovery cap, 50/50 profit share, and 10% excise on fuel imports.
• This ensures more revenues, more jobs, and stronger local participation, while protecting Guyana’s international standing.
Please permit me to correct the spate of inaccuracies propagated Dr. Vincent Adams in his missive published in the August 27, 2025, edition of the Stabroek News, with the caption “PPP/C has comprehensively failed in relation to oil and gas industry”: Therein, Dr. Adams sought to portray the People’s Progressive Party/Civic (PPP/C) Government as having betrayed Guyana on oil and gas. He repeats a long list of accusations – but each one crumbles when set against the actual legal history, the real record of governance, and the transformative actions taken since 2020.
𝗖𝗼𝗿𝗿𝗲𝗰𝘁𝗶𝗻𝗴 𝘁𝗵𝗲 𝗙𝗮𝗹𝗹𝗮𝗰𝘆: 𝗧𝗵𝗲 𝟭𝟵𝟵𝟵 𝗟𝗶𝗰𝗲𝗻𝗰𝗲 & 𝟮𝟬𝟭𝟲 𝗣𝗦𝗔
First and foremost, let me correct a long-standing fallacy that has gone unchallenged for far too long regarding the 1999 Petroleum Prospecting License issued to ExxonMobil Guyana (formerly Esso Exploration and Production Guyana Limited) and the 2016 Petroleum Agreement. It is vital that the historical facts be set out clearly and accurately, so the Guyanese people understand the true origins of these agreements.
𝗧𝗵𝗲 𝗙𝗮𝗰𝘁𝘀: 𝗥𝗼𝗼𝘁𝗲𝗱 𝗶𝗻 𝘁𝗵𝗲 𝟭𝟵𝟴𝟲 𝗣𝗡𝗖 𝗟𝗮𝘄
The fallacy lies in APNU+AFC’s defense of its lopsided 2016 Agreement with ExxonMobil Guyana (EMGL). Their claim was that the 2016 deal simply carried forward the same fiscal terms from the 1999 License, issued under the PPP/C government by the late President Janet Jagan. In that original license, the royalty rate stood at just 1%.
In 2016, APNU+AFC proudly celebrated “improving” this to 2% — a mere one percentage point more — and sold it to the nation as evidence of world-class negotiating skills. To make matters worse, they inserted, at EMGL’s behest (understandably so following the Venezuela case), a sweeping stability clause. That clause effectively froze the fiscal regime and obligated the government to compensate ExxonMobil for any future changes that might reduce its take — a move that severely limited Guyana’s flexibility in safeguarding its own interests.
What are the facts? The facts are that:
(i) The 1999 Petroleum Exploration License was issued under the authority of the Petroleum (Exploration and Production) Act No. 3 of 1986, which was enacted under the PNC administration, assented to by the former and late President Desmond Hoyte. And most notably, this Act gave the Minister power (Section 51) to alter Guyana’s tax laws for petroleum contracts. It is under this very law that the 1999 licence to ExxonMobil was issued – long before PPP/C returned to office – and which also governed the 2016 Production Sharing Agreement (PSA).
For ease of reference, Section 51 (1) established the legal authority for the Modification of Tax Laws, which states:
“The Minister assigned responsibility for finance may, by order, which shall be subject to affirmative resolution of the National Assembly, direct that —
(a) any or all of the written laws mentioned in subsection (2) shall not apply to, or in relation to a licensee, or
(b) any or all of the written laws mentioned in subsection (2) shall apply to, and in relation to, a licensee subject to such adaptations, exceptions, modifications and qualifications as may be specified in the order.
(2) The written laws referred to in subsection (1) are —
(a) Income Tax Act;
(b) the Income Tax (In Aid of Industry) Act;
( c ) the Corporation Tax Act; and
(d) the Property Tax Act.
Accordingly, the ExxonMobil 1999 license and its extension in the 2016 PSA are both rooted in the 1986 Act. Importantly, the 2016 agreement signed under APNU+AFC included a ‘stability clause’ (Article 32), which prevents unilateral renegotiation by government as referenced earlier. The PPP/C cannot tear up a binding contract without wrecking Guyana’s international credibility and investor confidence. This is not surrender – it is respect for the rule of law.
(ii) What did the PPP/C promised and delivered in relation to the “renegotiation of those contracts”?
𝗪𝗵𝗮𝘁 𝗣𝗣𝗣/𝗖 𝗣𝗿𝗼𝗺𝗶𝘀𝗲𝗱 𝗮𝗻𝗱 𝗗𝗲𝗹𝗶𝘃𝗲𝗿𝗲𝗱
In order to effectively renegotiate the Petroleum Agreements and change the fiscal terms, the PPP/C government had to embark on a complete and comprehensive overhaul of the outdated legal framework. Those reforms could not have been legally effectuated without the legislative reforms. Consequently, since assuming office in 2020, PPP/C government has enacted two landmark reforms:
(a) The Local Content Act (2021) – now responsible for over 6,000 Guyanese jobs, 1,000+ Guyanese firms, and nearly USD $1 billion in local spending, which is poised to grow proportionately to the scaled expansion of the sector as Guyanese firms continue to build and develop their capacity and capabilities; and
(b) The Petroleum Activities Act (2023)— which repealed and replaced the 1986 Act Petroleum (Exploration and Production) Act, thereby introducing a modern legislative and regulatory regime governing the oil and gas sector.
Under the new legislative framework, all new petroleum agreements now carry terms far superior to the 2016 PSA:
• 10% royalty (up from 2%)
• 10% corporate tax (up from 0%)
• 65% cost recovery cap (down from 75%)
• 50% profit oil share remains
• 10% excise on fuel imports
These measures shall ensure Guyana captures a significantly greater share of future petroleum revenues.
The opposition pretends that tearing up the 2016 PSA is possible or wise. The truth: such reckless behaviour would expose Guyana to billions in penalties and international arbitration. PPP/C instead took the responsible path – honouring contracts while reforming the framework so that all new licences deliver much stronger benefits. That is how serious governments govern.
Dr. Adams claims PPP/C abandoned oversight and endangered the environment. In fact, the PPP/C government has strengthened the regulatory framework under the Environmental Protection Agency (EPA), inter alia, substantially improved Licenses than those issued under his hand when he served as the former EPA head.
𝗖𝗼𝗻𝗰𝗹𝘂𝘀𝗶𝗼𝗻
The record is clear. The outdated 1986 PNC law created the weak fiscal terms. The 1999 licence and 2016 PSA flowed from that law. The stability clause makes reckless renegotiation impossible. What PPP/C did—and no one else could—was deliver on its promise by overhauling the legal framework, introducing new fiscal terms, creating jobs, empowering local businesses, and safeguarding Guyana’s long-term interests. That is not betrayal. That is responsible leadership and governance.
𝗕𝗼𝘁𝘁𝗼𝗺 𝗹𝗶𝗻𝗲: The 1999 license and 2016 PSA sit on a PNC-era law (1986). PPP/C changed the law and the terms once back in office—delivering stronger, Guyana-first outcomes while protecting the country’s reputation for honoring contracts.