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The never-ending saga of the Gas-to-Energy Project: Of Promise, Planning and a Bleeding of Billions – Column 178 dated 3 April 2026
This series, originally carried in the Stabroek News, will continue on this platform while maintaining the numerical sequence of the columns
Road to First Oil
Every man, woman and child must become Oil-minded
The report of a quiet settlement – some US$82 million paid following arbitration in the Gas-to-Energy Project – ought to give the country pause. Not because disputes arise in projects of this scale – they do – but because of how early, how quietly, and how expensively this one has done so. It is a thought that comes uncomfortably to mind, for what we are witnessing is not merely a problem of execution but a problem of design.
Projects of this magnitude do not descend into arbitration at this stage unless something fundamental has already gone wrong – not only in construction, but in conception, procurement and planning. The Wales development now presents a pattern rather than an isolated difficulty. The soil problems – predictable, avoidable, and elementary – have required extensive stabilisation work at significant additional cost. That is not contingency; it is a failure of due diligence. The arbitration, settled at approximately US$82 million after an even larger initial claim, is not misfortune but a failure of contract structuring and risk allocation. And surrounding all of this is a troubling silence in which the country was not told, the cost was not disclosed, and the implications have not been explained.
Layered onto this is the matter of time – promised, revised, and repeatedly missed. The project was first presented with timelines that spoke to completion within a compressed horizon, at one stage as early as 2024. That date passed. It was then shifted to 2025. That too slipped. We were then told to look to 2026, and now even that horizon appears uncertain, with full completion drifting into 2027. Each revision has been presented as an adjustment; taken together, they tell a different story. Deadlines are not merely dates on a calendar – they are statements of planning, competence and control. When they are missed once, questions arise. When they are missed repeatedly, conclusions begin to form.
The difficulty, however, runs deeper than delay. This project is inseparably tied to the petroleum operations offshore under the 2016 Production Sharing Agreement. The gas originates there, its economics are shaped there, and its accounting must ultimately return there. Yet the project is treated as though it exists outside that framework – outside its transparency, its discipline, and its scrutiny. If any part of this expenditure is treated as recoverable cost, then the country is paying in ways not immediately visible: not only through direct budgetary outlays, but through reduced oil revenues. It is paying in cash, and in silence.
Even on the most conservative view, the visible costs alone are troubling. A project once presented in the hundreds of millions now sits comfortably in the billions, and each delay adds not only time but cost, while each dispute adds not only cost but uncertainty. Each missed deadline extends the period during which households and businesses continue to pay existing tariffs, pushing further away the central promise upon which the project was sold: cheaper electricity. In the meantime, there is a compounding burden in which capital is committed but not productive, inefficiencies accumulate, and assumptions are overtaken by reality. The project does not wait for reality; reality moves on without the project.
There are also costs that do not appear in any estimate, but which are nonetheless real. Land has been compulsorily acquired, and citizens have been required to surrender property for what is said to be a national purpose. Yet questions remain as to whether compensation reflects true value. Where fairness is uncertain, legitimacy is weakened, and where legitimacy is weakened, dissatisfaction and suspicion inevitably follow.
And still, the central question remains unanswered: who is responsible? There is no clear single point of accountability, no consolidated reporting, and no regular, transparent accounting of cost, progress, and risk. Responsibility appears diffused, accountability remains elusive, and transparency is, at best, selective. In such an environment, even success becomes difficult to measure and failure difficult to assign.
We have seen this movie before, not as a trailer – or as a shorts as it was called in my days – but as a full saga. The Skeldon Sugar Modernisation Project followed a similar path of early promise, escalating cost, shifting timelines, prolonged silence, and then disaster. The difference now is one of scale. Then, the sums seemed large; now, they seem modest. Yet the underlying lesson appears unchanged, and the consequences potentially far greater.
What is perhaps most concerning is that even though this project remains incomplete – its cost uncertain and its performance untested – there is already movement toward expansion. Another gas-to-energy project, additional capacity, and replication without validation are being contemplated. This is not sequencing but escalation, and it risks compounding uncertainty rather than resolving it.
We are told that this is a “world-class” project. It may yet become one. But as matters now stand, it is something else: not a white elephant, for it will be used, but a costly lesson in weak planning, poor sequencing, and avoidable error. What began as a promise of progress has become a matter of concern – about cost, about competence, and about governance. And now, with the disclosure of the arbitration settlement and the accumulation of missed deadlines, one further conclusion presses itself forward: this is no longer merely a project under strain; it is a project riddled with uncertainties, missed deadlines, mismanagement, ballooning cost and bleeding billions.
CCJ throws out Cara’s case against Christopher Ram and Bank of Nova Scotia
What began almost a quarter of a century ago as a judicial adventure has now run its full course, ending before the Caribbean Court of Justice, the region’s highest court.
The proceedings arose out of a Request for Proposals issued in November 1999 in my capacity as Receiver-Manager of Hotel Tower Limited. CARA submitted what it described as an expression of interest, expressly conditional upon due diligence and other matters. Before the process could run its course, CARA commenced proceedings claiming that I breached contractual and collateral obligations and sought to stall the process.
Those claims were soundly rejected at every level of the court system. The High Court dismissed them. And the Court of Appeal affirmed that decision. But CARA and its counsel persisted. And now, in an erudite, unanimous and thoroughly reasoned judgment, the Caribbean Court of Justice has brought the matter to an end.
In its judgment, the Court clarified and restated the law in Guyana on tendering and contractual formation. It recognised the concept of a process contract – now applicable to both public and private tendering – while making it clear that such a contract does not arise automatically. The decision requires a careful review of how tender processes are structured and communicated. It also provides timely and authoritative guidance on the need for clarity in tender documents, strict compliance by bidders, and discipline in the conduct of the process.
That CARA chose to pursue this litigation was not without consequence – and benefits. The Court used the opportunity to develop the law and, in doing so, offered clear reminders about the proper limits of litigation. The duty of legal counsel is not only to advance their clients’ cases but to advise against claims that are speculative, premature, or lacking in legal foundation. When that duty is not observed, the consequences are inevitable – as CARA has now learned to its cost.
In my respectful view, this case lacked merit from the outset and ought not to have been pursued. It has, however, served a useful purpose. The law has now advanced, and our practices and procedures must follow in lockstep. The guidance is clear. The integrity of the tendering process in Guyana – and accountability in contract awards – will be stronger for it.
Christopher Ram
25 March 2026
Letter re Kaieteur News
Dear Editor,
In my Stabroek News column # 177 published yesterday reflecting on the journey of writing on Guyana’s oil and gas sector, I acknowledged several individuals and institutions that helped sustain the national conversation on petroleum governance. I regret, however, that I failed to acknowledge a media house that played an important role in bringing many of those issues to a wider audience.
Over the years Kaieteur News, under the leadership of its publisher Mr. Glenn Lall, frequently drew on several of my oil and gas columns as the basis for investigative reports and news stories. In doing so, the newspaper helped extend the reach of those analyses and placed matters relating to petroleum contracts, fiscal arrangements and transparency before a broader section of the Guyanese public.
Reporters such as Ms. Kiana Wilburg, Davina Bagot and their colleagues deserve particular recognition for the diligence with which they pursued those stories. I therefore owe and extend to them a personal apology.
With the closure of Stabroek News, the space for independent scrutiny of public policy inevitably narrows. The responsibility for informed and fearless journalism therefore becomes even more important. It is my sincere hope that media institutions, especially Kaieteur News, will continue to carry forward the task of informing the public and asking the difficult questions that democratic accountability requires.
Yours faithfully,
Christopher Ram
The Closing Ledger
Business and Economic Commentary
This column also brings to mind an earlier series, Business Page, which began in the early years of Sunday Stabroek under the editorship of David de Caires and Anna Benjamin. That column was interrupted after a disagreement over a piece on Caribbean Containers Inc. which prompted a defamation threat by its CEO, Ron Webster. Sunday Stabroek published an apology over my objections, which I felt might weaken my position should the matter reach the courts. I stood my ground and defended the action. No case ultimately succeeded, and the column eventually resumed.
The decision to bring Sunday Stabroek – a sibling of Stabroek News – to its final edition marks more than the end of a newspaper. It closes a chapter that began in 1986, when Guyana’s economic circumstances were vastly different from today. The economy was small and constrained, public finances were tight, shortages were common, and the state’s capacity to finance development was limited. Few would have imagined that four decades later the country’s economic output would be measured in the trillions of dollars.
Today the economy is estimated at roughly $1.5 trillion, a transformation – driven largely by offshore petroleum discoveries just over a decade ago – that reshaped both expectations and fiscal capacity. In a remarkably short period, the country has moved from harsh scarcity to the paradox of abundance.
Yet economic expansion does not automatically resolve the deeper questions of governance and accountability. Indeed, it often magnifies them. A striking illustration of this transformation lies in the public accounts themselves. The fiscal deficit projected for 2026 is larger than the entire national budget of 1986. That single comparison captures both the extraordinary growth of the economy and the expanding scale of the state’s financial commitments.
An unusual institutional development deserves notice. For the first time in Guyana’s post-independence history, responsibility for the nation’s finances has not been assigned to a separate Minister of Finance. However long-titled Dr. Ashni Singh’s designation might be, the portfolio remains with President Irfaan Ali, departing from long-standing administrative practice. The reasons were never clearly explained. At a time when public finances have expanded dramatically, concentrating fiscal authority in the executive inevitably raises questions about motive, institutional balance and oversight.
There is also a paradox that deserves reflection. The current administration came to office with what many regarded as one of the most academically accomplished economic leadership teams in the country’s history. Yet outcomes in several areas raise uncomfortable questions. Years after the completion of field work, the report on the 2022 national census is still outstanding. Long-standing structural challenges at the National Insurance Scheme appear to have deepened rather than eased. And in an economy experiencing unprecedented inflows of foreign earnings, complaints about the scarcity of foreign exchange continue to surface within the business community.
The contrast between the promise of technical expertise of Dr. Singh and the persistence of these difficulties, illustrates how economic management ultimately depends not only on credentials, but on the effectiveness of individuals, institutions and policy execution. Indeed, growth has also been accompanied by persistent concerns about the management of public resources. Over the years, observers have increasingly remarked on the pervasiveness with which corruption is alleged to have entered public life. What once appeared episodic now seems, to many citizens, more open and institutionalised.
Large and ambitious undertakings – among them the proposed development of Silica City and the gas-to-shore project – have been promoted as symbols of national ambition. Yet, their costs, their financing arrangements, their priorities, and their long-term economic justification are mired in obfuscation and opacity.
Fiscal policy itself has also evolved in notable ways over the past four decades. Personal income rates were dizzyingly high, reaching a combined marginal rate of 75%. Estate duty, sometimes referred to as Death Duties, formed part of the fiscal regime that had existed since income tax was first introduced in 1929. Except in the CIA inspired action against the 1962 tax measures introduced by the Cheddi Jagan premiership, most Guyanese grudgingly met their obligations.
Over the life of Sunday Stabroek, tax rates have tumbled, while some taxes have disappeared altogether. Capital taxes on death have vanished from the system, and more recently the wealth-related levy known as property tax for individuals, has effectively faded from relevance. At the same time, businesses and their leaders routinely advocate additional relief and concessions as “measures to stimulate investment and growth”.
Such developments raise legitimate questions about balance within the fiscal framework. A state with expanding expenditure obligations must also maintain a revenue system that is transparent, equitable, and sustainable. Otherwise, the burden of financing development shifts in ways that may prove difficult to sustain over time.
One area that has received remarkably little attention is the steady decline of the labour movement. Institutions such as the Trades Union Congress and the Guyana Public Service Union appear weaker and less effective than at any time since the colonial era. Leadership has too often placed politics ahead of membership, and the purchasing power of the minimum wage seems to bear a striking relationship to the quality of labour leadership.
These are precisely the types of issues that newspapers have traditionally examined. One of the enduring contributions of Stabroek News was its willingness to provide space for economic commentary that explored not only the promise of growth but also the institutional challenges that accompany it.
No reflection on this moment would be complete without acknowledging the role that Stabroek News played in holding the nation to account. That task was not always welcomed. At various moments, the newspaper faced pressures – political, commercial and financial – that might well have weakened a less determined institution. Yet it persisted in asking questions, examining public decisions and providing a forum where issues of national importance could be debated openly.
Particular recognition must go to the newspaper’s Editor-in-Chief, Anand Persaud, whose stewardship in recent years has required an extraordinary range of responsibilities. In many respects he has carried forward the demanding editorial tradition established by the newspaper’s founder, David de Caires, while simultaneously assuming functions that were once shared among several senior figures in the newsroom. That continuity of purpose has been essential in preserving the paper’s distinctive voice.
Equally deserving of recognition are the many individuals whose work rarely appeared in print, but whose dedication ensured that the newspaper reached its readers day after day. The production staff who kept the presses running through long nights, particularly after the paper moved to a seven-day schedule, demonstrated a level of commitment and resourcefulness that is seldom fully appreciated outside the walls of a newsroom.
Since the announcement of the newspaper’s closure, tributes from readers, writers and columnists have poured in – many eloquent, some deeply emotional, others personal, and a few that brought tears to the eyes. Together they testify to the quiet but profound place the newspaper has occupied in the intellectual and civic life of the country. Those tributes speak for themselves, and one can only join in endorsing the appreciation they express for the many people who sustained this institution over the years.
As the final issue rolls off the expertly maintained press, the national ledger which Stabroek News helped to maintain remains far from settled. The economic story of Guyana continues to unfold, shaped by decisions about governance, fiscal discipline and public accountability. One ledger may close with this edition.
The larger ledger, the one that records how Guyana manages its wealth, builds its institutions and governs itself, remains very much open.
The Exxon Audit Dispute: Two Fundamental Errors
Every man, woman and child must become oil-minded
Column # 178
Column Title: The Exxon Audit Dispute: Two Fundamental Errors
One of the last substantive reports carried by Stabroek News before the company entered liquidation dealt with the continuing dispute between the Government of Guyana and ExxonMobil over the appointment of a Sole Expert to determine the US$214 million in costs questioned in the IHS Markit audit. Normally, this is precisely the type of issue I would address in my regular column in that newspaper. Two fundamental issues arise from the report: how disputed audit issues are to be resolved in the absence of agreement, and where responsibility lies for the audit provided for in the Agreement.
With Stabroek News no longer available, I will address these and future matters in this personal blog, available for free use by any person with due attribution. For purposes of continuity, I will treat this as column 178.
Resolving audit issues
The Agreement itself sets out a clear process for dealing with disputes arising from the audit allowed under the 2016 Agreement. The audit is conducted on behalf of the Government under the authority of the Minister responsible for petroleum. Once the audit is completed, the Minister communicates its findings to the Contractor, identifying those costs that are questioned or disallowed and inviting a response within the prescribed time frame. During that period the parties exchange correspondence and attempt to reconcile any differences. Only if those efforts fail does the dispute move to the next stage.
That stage is the appointment of a Sole Expert.
The report suggests that ExxonMobil is insisting on the appointment of a particular expert. The Agreement simply does not allow this. The Sole Expert must be appointed by agreement between the parties, and if the parties cannot agree within the specified period after notice proposing the appointment, the appointment is to be made by the International Chamber of Commerce in accordance with its Rules for the Appointment of Experts and Neutrals.
In other words, neither party has the right to impose its own nominee. The requirement that the expert be independent and impartial makes it all the more troubling if the individual proposed by one side has previously carried out assignments for that same party.
The second error is the Government’s apparent decision to place responsibility for the audit in the hands of the Guyana Revenue Authority. That approach conflates two entirely different legal regimes.
The GRA is by statute required to administer the tax laws, including carrying out a tax audit. The audit under the Agreement is not a tax audit. It is a contractual audit carried out under the Petroleum Agreement. Article 23 expressly gives the Minister the right to audit the accounting records of the Contractor relating to petroleum operations in accordance with the Accounting Procedure set out in the Agreement.
To place the GRA at the centre of the present dispute blurs a distinction that should be obvious. The audit under the Agreement is the responsibility of the Government acting through the Minister responsible for petroleum. It is that authority which must assert the Government’s position and defend its findings under the Agreement.
But the Government and President Ali seem afraid to speak to Exxon as a sovereign power. President Irfaan Ali recently hosted senior ExxonMobil executives at State House at public expense. President Ali must understand that the company is frustrating the audit process by attempting to dictate the choice of Sole Expert. He should have used the opportunity to state Government’s position plainly: that ExxonMobil must respect and conform with the terms of the 2016 Petroleum Agreement.
The two issues ultimately are ultimately one of institutional responsibility. The State signed the Petroleum Agreement. It the State, acting through the Minister responsible for petroleum, that must assert and defend its rights under that Agreement. Those responsibilities cannot be outsourced or quietly shifted to another agency simply because the Government is afraid to displease Exxon.
The Government must use the provisions of the Agreement without fear or favour. Anything less risks reinforcing the perception that the Ali Administration is too weak and scared to represent the national interest.