Global Witness withdraws contentious report on oil contract

…admits to overestimations

In a surprising turn of events, Global Witness has withdrawn its ‘Signed Away’ report on Guyana which claimed that the country stood to lose an entitled US$55 billion dollars from a bad oil deal with ExxonMobil.
The report laid the claim that Guyana presented “feeble negotiation terms” and the “aggressive company” [ExxonMobil] took advantage of this when it “negotiated an exploitative deal.”

It also theorised that former Natural Resources Minister, Raphael Trotman, who signed the Exxon deal in June 2016, may have been compromised, even though they admitted that they had no proof of this. The report was released just before the March 2020 General and Regional Elections.

In the statement shared on Monday, the organization said that the report does not represent the mission of Global Witness and it regrets any damages it may have caused.

“Our February 2020 report on Guyana’s oil sector, Signed Away, is not consistent with that focus [on the climate emergency] and for this reason that we have decided to remove it from our website and stop using it in our campaigning work. We regret any unintended negative consequences arising from the report, including its stifling of debate within Guyana around actions to address climate change,” the organisation stated.

When the report came to the fore, several former Government Ministers were criticized leading up to the elections. Claims were later made the that the report was sponsored by the current Administration to improve its footing at the elections. However, Vice President, Bharrat Jagdeo – then Opposition Leader – denied these claims stating “we have no such power over Global Witness”.

Explaining the decision to withdraw the report, the company said that the Signed Away report focused on how much revenue Guyana could obtain from oil if the government negotiated a fairer deal with oil major Exxon.

However, it noted that its revenue analysis assumed that Paris Agreement climate commitments would not be implemented – leading to an overestimation of the amount of oil Guyana would likely produce and the value of that oil.

“Under the new organisational strategy we have rolled out this year, this is not a scenario that we would accept because greenhouse gases have to fall by half over the next decade, for the sake of the planet and all of us living on it. Moreover, since publication, oil prices have dropped by more than a third [due to COVID-19]…these factors led us to overestimate the potential economic benefit of oil extraction. Based on feedback from civil society representatives in Guyana, we recognise that our report has made it harder for them to argue the case for cessation of oil production in their country,” the organization acknowledged.

In rejecting the report in February, the then Administration had dubbed it as “sensationalist, agenda-driven and extraordinarily speculative” meanwhile, it argued that “the figure of $55B is random, arbitrary and highly speculative”.

Even so, in its retraction, Global Witness made it clear that its decision to withdraw the report is not an endorsement of the way Exxon or Guyanese officials negotiated the oil licences awarded to the company.

It stated that it stands by the integrity of the evidence presented and by the fiscal model produced by OpenOil that was commission