Features — 17 January 2014
Oil and the Barrow administration

When I first learnt about the entire country of Belize being leased to oil companies I felt a rage towards the People’s United Party, because they were the ones who signed the contracts without public knowledge and without competitive public bidding. Then when I read the contents of the contracts, called production sharing agreements (PSA), the rage multiplied ten fold upon ten fold. I could not understand how any leader of this country could agree to terms that are basically a sell-out of our patrimony and a sellout of our natural heritage. This land is our birthright. The moment we are conceived in our mother’s womb we become an inheritor and the moment we pop out of her womb we become a shareholder. No one has to write a will to give us an interest in the bounty of our land and we do not need for anyone to die, to pass us this “legacy.” No matter where you go, once you are born in Belize, your homeland you not only inherit, but you have a God-given obligation to protect your inheritance.

So when a leader, by contract or conduct, agrees to terms that amount to a giveaway of this, our birthright or inheritance, to someone else, especially a non-Belizean, this giveaway of what is ours, comes off as them selling us out, because they underestimate our value and true worth. To begin with, there is no price that can be placed on what is our natural bounty. And there is no price that can replace our forests, wetlands, reefs, atolls, rivers, mountains, flora and fauna. Oil companies must destroy some of these to first investigate if there is even oil, through seismic testing, and then destroy even more through extraction, and then transportation out of Belize. So leaders need to consider this before proceeding to sign their names on the dotted lines of any oil contract.

So my conclusion, the PUP in the persons of Johnny Briceño and Florencio Marin, did us a disservice to sign these contracts. And if this had become necessary for “development,” then the terms were onerous and in no way promoted the development of our people and country.

The UDP steps in

So it was after a change of government, in 2009, that I first heard, from Giovanni Brackett, that these oil contracts existed, and it was at Oceana’s inaugural media blitz that this occurred. It was incredible that so few of us even knew that these contracts existed and thus not many of us even knew the contents of these.

I, maybe being naïve, assumed our new government of the Barrow administration, having just come into office in 2008, was not yet aware and abreast of these development, and so I gave them the benefit of the doubt that our Honorable Prime Minister, Dean Oliver Barrow, was unaware of the extent of the wholesale “sell-out” of our patrimony by their opponents whom they had just swept out of office.

It was not until April 2010 that I finally got to see a copy of the oil concession maps and saw that the entire country was given out and it was about then that I learnt about the contracts. I wanted to study them and understand their legal binding effect, but once I did that I knew they were dangerous for the people of this country, but not for the few who stand to benefit directly. Once I read them I knew they could not remain, and I was convinced they were unlawful for various legal violations under the Petroleum Act, the main two being: they violated the competitive bidding process and the concession holders did not qualify to even be given such concessions. Thus those contracts in my view were illegal from the start.

When these and other points were brought to the attention of the government, amazingly the response and a position were not forthcoming. But on January 6, 2011, almost one year after the country had reacted to the revelation of these hidden contracts, the Prime Minister finally gave his take when he said: “I am telling you that we are not going to lightly ignore written contracts, this is not a Michael Aschroft type scenario, these are legitimate contracts, not outlaw agreements and we simply can’t walk away from those agreements.”

Legal or outlaw?

So, if the PM with his legal mind felt so, then we had to take the matter to the courts of this land, whose role is to pronounce on the legality of these once asked. By December 2011 claims were filed for the court to make a determination. It moved slowly through the court system. Finally on April 13, 2013, the verdict was out. As to the legality of these “written contracts,” Justice Oswell Legall found that they were more than “outlaw,” as he gave the following orders:

“A declaration is granted that the Production Sharing Agreement dated 25th May, 2004 and the other five Production Sharing Agreements dated 12th October, 2007 made by the Government of Belize through the Defendants on the one part and the individual companies …. of the other part, are UNLAWFUL, NULL and VOID…” [emphasis mine] How more clear could this be?

On a golden platter the Barrow administration gets their legal answer and their way out of these onerous and anti-development contracts. Yet, instead of embracing the Legall ruling and being thankful that it was not they who signed them originally it seems the government was intent on saving the contracts as if they had a hand in them.

The Judge went on to provide the two reasons why he reached this conclusion:

1. No environmental impact assessments were carried out before entering the agreements; and

2. The agreements were entered into with companies that did not demonstrate a proven ability to contribute the necessary funds, assets, machinery, equipment tools and technical expertise necessary for the effective performance of the terms and conditions of the agreement.

So straightforward…. Yet we still have these same “unlawful, null and void” contracts being implemented with the sanction and assistance of the state/government. A government that keeps telling people this is needed because the implementation of the contracts will bring in much needed money…. But they forgot to explain for whom and to whom the monies will come.

Monies from oil contracts – are they real?

I strongly submit that the money is not coming for the country and it cannot be that the government officials believe their own rhetoric, when a close inspection of the two so-called promising contracts were negotiated now by this new government and instead of fighting for better terms so that indeed the nation gets more money in its treasury, the opposite happened.

It is important for the comparison of the terms of the contracts under the hand of the PUP be made to the ones under the hand of the UDP. So it’s like Florencio Marin versus Gaspar Vega. And which do you think provided for better terms? See for yourself!

Why would Minister Vega accept as little as 7.5% for as much as 30,000 barrels of oil daily? Note that under the Florencio Marin version of the contract, for the same first 30,000 barrels per day a whopping 35% of profits would go to the Government coffers.

Conclusion reached?

With figures and decisions like these, do you really believe oil will bring us money when our Minister just sold us out of 27.5% of profit, which, if oil is found, could have gone a long way to help our people? But talking about people, nowhere in any of those contracts are there provisions for direct investment by any party into the community where the oil is being extracted from. There are no provisions to maintain and repair the roads that become busted up by heavy tankers; or for electricity to the villages where oil to fuel others’ need for power, will come from. The contacts exclude the commitment of direct benefits to the people, yet the people are told it will bring money. But that same money, which should be our people’s money, was, by the stroke of a pen, forgone!

So it cannot be true that the government will defend these unlawful contracts for the money it will bring… hmm, that does not go so! And the contracts speak for themselves.

God bless Belize!

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