Slashing Parent Company Guarantee from Full Coverage to $2B

Slashing Parent Company Guarantee from Full Coverage to $2B is a sellout to Exxon

All Guyanese, our Caribbean neighbors, and Venezuela, must now be worried sick by the Honorable VP Jagdeo’s announcing that slashing the parent company guarantee from full coverage, down to a piddly $2 Billion USD, “remains a priority”. This in-your-face sellout and betrayal of our people, not only throws out the existing legal full liability coverage which the government has so cowardly failed to enforce; but also, cold-bloodedly exposes Guyana and our neighbors to potential economic ruins, in the event of a major oil spill.Full Liability Coverage as enshrined in the permits, equals insurance plus a parent company guarantee to cover “any” costs above insurance. In mathematical parlance:Full Liability Coverage = Insurance + Parent Company Guarantee for all remaining costsThis is similar to having health or car insurance, where insurance covers a certain percentage of the bill and you have to foot the remainder. Likewise, in the case of an oil spill such as the Macondo in the Gulf of Mexico, a $2B guarantee and the $600M USD insurance, only add up to $2.6B which is less than 2% of Macondo’s $145B cost. The remaining $142.4B have to come from somewhere; thus, the absolute necessity for a full hook in of EEPGL’s parent company Exxon to cover this remainder, since unaffordable for EEPGL in such a scenario. Without this full hook in, there must be an explanation as to who will cover costs over that $2.6B. Though far less than enough, the VP answers this, by putting forth that EEPGL’s $8B in assets could be seized. However, as sanctified in the contract, all of EEPGL’s assets will be turned over to us “free of charge”, since we paid for these in cost oil. This means the seizing of our own assets is senseless. It also begs the question, why did EEPGL get incorporated in the Bahamas and not Guyana, and would this in itself, shackle Guyana from accessing any of their little money, anyway? Therefore, the VP must identify which assets not owned by the Government, add up to this $8B. EEPGL is only a subsidiary of parent company Exxon, incorporated in the Bahamas, with very little assets, and set up as a Limited Liability Company (LLC) to operate Guyana’s oil projects. LLCs are mainly formed to protect the deep pocket big boys like Exxon from liabilities. As a reslt, Exxon has no legal connection to the Contract o

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