By KNEWS

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‘2% Can’t Work’: Former President Ramotar urges Caricom to urgently draft model oil contract for region

Oct 02, 2025
News

Kaieteur News – Guyana got ripped off when it signed the 2016 Production Sharing Agreement (PSA) with American oil major, ExxonMobil but this does not mean other Caribbean Community (CARICOM) member states should suffer the same fate.

This is the view of former President Donald Ramotar. In an interview with Kaieteur News, the former Head of State touted the need for a model PSA to be adopted by CARICOM to ensure countries enjoy maximum benefits from their natural resources, particularly oil and gas.

With Suriname expected to commence production activities soon, other CARICOM countries such as Jamaica and Grenada have joined the hunt for black oil, Ramotar said in a letter earlier this week.

In an invited comment, he told Kaieteur News, “Instead of all of them getting ripped off like us, we should really get a strong investment regime so that everybody is on the same page. Oil don’t come back, so we need to benefit as much as we can. Two percent can’t wuk (referring to Guyana’s low royalty rate).”

When asked if he considered the different risks that may be involved in exploring for the resource in the other countries, Ramotar made it clear that each state must take authority over its non-renewable resources. He said, “You’re not dealing with angels. We just saw the situation with ExxonMobil getting a receipt from us for paid taxes and not paying taxes in the U.S and all of that so I think we have to take a line with our natural resources because these are not resources that will grow back.”

The former Head of State continued, “Therefore we need to have a fair share with all due respect to the investment and all consideration to the investment made we are due to have a proper regime so that we can optimize our benefits.”

Ramotar has not been shy in highlighting the rotten deal Guyana accepted. In fact, he is on record stating that he would have renegotiated the terms of the agreement signed by the former APNU/AFC Coalition.

In his letter to the editor published on Tuesday, the former President wrote, “One of the benefits that the leaders and the people of the region had hoped was that with the creation of CARICOM, the regional governments would have been acting together. This is very important since we are relatively small individually and in terms of our population. Therefore, acting on issues jointly would enhance the influence of the region internationally.”

Ramotar is adamant that CARICOM has the potential to increase its bargaining power immensely when transacting business with multi-national corporations and large countries.

He urged, “This is more important at this stage in our region’s development.” The former President went on to point out that Guyana has become a major producer of oil and gas. On the other hand, Trinidad and Tobago has been producing those same resources for over 100 years now, with most of its reserves depleted. Currently, exploration activities are ongoing to augment the nation’s dwindling oil reserves.

“We know that Guyana in 2016 got a very poor deal. In passing, it is still a mystery why the then government did not involve Trinidad specialists during the negotiations to begin production. That as it may, we now have a situation where three of our countries are oil and gas producers (Guyana, T&T and Suriname). Others may join soon,” he said.

Ramotar therefore suggested a model arrangement that can ensure the region benefits more than the oil giants that are coming.

He explained, “It would be in the interest of our countries individually and for the region collectively if we can work out a common regime to deal with the huge corporations that are descending on the region. This would prevent the oil giants from playing us off against each other. Just as we have a Common External Tariff, we should develop a common investment regime in our natural resource sector.”

The former President noted that this was especially important for Guyana and Suriname which has similar resources. According to him, “If this could be achieved then the people of our region will benefit more from our natural resources and integration in CARICOM could be deepened.”

CARICOM, Donald Ramotar, ExxonMobil, oil, oil contract, PSA, royalty