President Irfaan Ali’s position on Guyana’s ExxonMobil contract presents a striking contradiction: he acknowledges that the 2016 deal is flawed, yet maintains that it should be left untouched. That tension is the central issue running through oil and governance commentator GHK Lall’s three-part examination of the agreement.
Across the three commentaries, Lall approaches the issue from three connected angles. First, he questions why a government that accepts the contract is deficient would not seek ways to improve it. Second, he examines Ali’s own descriptions of the agreement, including his characterization of it as “lopsided” and his acknowledgement that Exxon and its partners “had the better hand of the deal.” Third, he shifts the perspective to ExxonMobil, arguing that a company facing no credible prospect of renegotiation has little incentive to surrender additional economic benefits.
Part I: If the contract is bad, why leave it untouched?
In “Ali: Exxon Contract Is Bad, But Leaving Alone,” Lall focuses on what he regards as the contradiction between acknowledging the agreement’s weaknesses and accepting its existing terms.
His argument is that an admission that the contract is deficient should logically lead to a serious examination of whether anything can legally or commercially be done to improve Guyana’s position.
The government has acknowledged that the 2016 agreement contains terms that could have been better, but has maintained that the agreement should not be unilaterally renegotiated. It has instead emphasised stronger contract administration and improved agreements for future petroleum developments.
Lall’s first point is therefore one of consistency between recognising a problem and determining what can realistically be done about it.
Part II: Ali’s own words
In “Ali On Exxon Contract: Lopsided,” Lall turns his attention to the President’s changing descriptions of the PSA.
He cites Ali’s 2023 characterisation of the contract as “lopsided” and his 2024 acknowledgement that Exxon had “the better hand of the deal.” Lall contrasts those statements with the government’s continuing position that the agreement should remain intact.
The underlying fiscal terms explain why the agreement remains so contentious. Under the 2016 PSA, Guyana receives a 2 per cent royalty, while up to 75 per cent of production can be used for cost recovery, with the remaining profit oil divided equally between Guyana and the consortium. As recoverable costs decline, Guyana’s share of production increases. The government reported in August 2026 that Guyana’s effective share had reached approximately 39.8 per cent, in addition to the royalty.
Lall’s concern is not simply the President’s choice of words. He is asking what significance those acknowledgements have if they produce no corresponding effort to alter the existing arrangement.
Part III: Why would Exxon give more?
In “Exxon’s Contract — In Exxon’s View,” Lall reverses the perspective and considers the matter from ExxonMobil’s side of the negotiating table.
His contention is straightforward: if Guyana has already ruled out renegotiating the existing agreement, why would Exxon voluntarily surrender additional value?
That question intersects with the PSA itself. Article 32 contains stability provisions requiring the contractor’s written consent before the government can seek to alter or avoid the agreement’s terms. The government has also said Exxon and its partners have opposed renegotiating the fiscal terms.
The government argues that contractual stability is important to investor confidence and that Guyana can secure better outcomes through stronger administration of the existing PSA and more favourable terms in newer petroleum agreements. Those newer model terms increased royalty to 10 per cent, reduced the cost-recovery ceiling to 65 per cent and introduced a 10 per cent corporate tax for future agreements.
Taken together, Lall’s three-part series returns repeatedly to the same unresolved policy question: if Guyana’s leadership acknowledges shortcomings in the country’s most consequential petroleum agreement, what obligation does that acknowledgement create to examine every available avenue for protecting the national interest?
The government and its critics remain divided over the answer. But with the Stabroek Block generating the overwhelming share of Guyana’s current oil production, the terms of the 2016 PSA remain central to the national debate over petroleum revenues, contract governance and the country’s long-term economic interests.
