Tues­day’s sign­ing of a pro­duc­tion shar­ing con­tract by the T&T Gov­ern­ment and the US en­er­gy gi­ant Exxon­Mo­bil is a sig­nif­i­cant de­vel­op­ment for this coun­try, for which the pre­vi­ous and cur­rent ad­min­is­tra­tions and the pub­lic ser­vants who did most of the work in ar­riv­ing at the agree­ment all de­serve ap­pre­ci­a­tion.

Dur­ing the sign­ing cer­e­mo­ny, Min­is­ter of En­er­gy and En­er­gy In­dus­tries, Dr Roodal Mooni­lal, ac­knowl­edged that the min­istry re­ceived ap­proval to en­gage in di­rect ne­go­ti­a­tions with Exxon­Mo­bil in De­cem­ber 2024, when Stu­art Young was the min­is­ter.

It would have been un­der Mr Young’s stew­ard­ship at the Min­istry of En­er­gy, there­fore, that the de­ci­sion was tak­en to en­gage in the di­rect ne­go­ti­a­tions with the en­er­gy com­pa­ny, rather than the pre­ferred method of a com­pet­i­tive bid round.

“Di­rect ne­go­ti­a­tions are al­lowed in the Pe­tro­le­um Act and have been adopt­ed by the Min­istry of En­er­gy as an ad­di­tion­al ap­proach in the ef­fort to ac­cel­er­ate and op­ti­mise the ex­plo­ration of our coun­try’s hy­dro­car­bon re­sources,” said Dr Mooni­lal.

The end re­sult of the ef­fort to ac­cel­er­ate the ex­plo­ration for oil and nat­ur­al gas was that the ne­go­ti­a­tions for the pro­duc­tion shar­ing con­tract were con­clud­ed at a “record pace,” ac­cord­ing to Exxon­Mo­bil’s John Ardill.

The pace may have been the re­sult of the ad­min­is­tra­tion, both pre­vi­ous and cur­rent, ac­cept­ing the com­pa­ny’s po­si­tion that the ex­plo­ration of the sev­en deep­wa­ter blocks, which have since been amal­ga­mat­ed in­to one block called TTUD1, should be con­sid­ered a fron­tier re­gion, with fis­cal terms sim­i­lar or the same as those en­dured by Guyana.

In the en­er­gy in­dus­try, fron­tier ex­plo­ration is con­sid­ered in new and un­ex­plored re­gions, as Guyana was when Exxon­Mo­bil took its first seis­mic read­ings of the deep­wa­ter Stabroek field in 2013.

As Guyana’s Min­is­ter of Fi­nance, Dr Ash­ni Singh, ex­plained to Guardian Me­dia last month, Guyana agreed to pro­vide the com­pa­ny with a ceil­ing on cost oil of 75 per cent, which means there was a floor on prof­it oil of 25 per cent. Guyana agreed to re­ceive 50 per cent of the prof­it oil, mean­ing T&T’s Cari­com neigh­bour agreed to re­ceive half of 25 per cent, which is 12.5 per cent, plus a 2 per cent roy­al­ty. Guyana, in ef­fect, re­ceives 14.5 per cent of the oil rev­enue gen­er­at­ed by Exxon­Mo­bil—which has caused a huge amount of an­guish, bit­ter­ness and con­ster­na­tion in that coun­try.

A re­turn of 14.5 per cent is a frac­tion of the rev­enues re­ceived by T&T, a coun­try that is con­sid­ered to be a ma­ture en­er­gy province, but in which the roy­al­ty on en­er­gy pro­duc­tion alone is 12.5 per cent and ex­plo­ration com­pa­nies pay ad­di­tion­al tax­es or prof­it share on top of that.

It is both in­ter­est­ing and note­wor­thy that the Guyana gov­ern­ment, un­der ex­treme do­mes­tic and in­ter­na­tion­al pres­sure, agreed to pub­lish its pro­duc­tion shar­ing agree­ment with Exxon­Mo­bil, al­though non-dis­clo­sure terms would have been em­bed­ded in its trans­ac­tions with the en­er­gy com­pa­ny.

It would be quite in or­der, then, for the Kam­la Per­sad-Bisses­sar ad­min­is­tra­tion, which fo­cus­es end­less­ly on trans­paren­cy and ac­count­abil­i­ty, to pub­lish the fis­cal terms of its en­gage­ment with Exxon­Mo­bil.

T&T is still re­cov­er­ing from the trau­ma of the Trump ad­min­is­tra­tion can­celling the Drag­on gas arrange­ments with Venezuela ear­li­er this year. The coun­try was told by the pre­vi­ous ad­min­is­tra­tion to ex­pect Drag­on rev­enues to flow by 2027. Yet, even if Exxon­Mo­bil finds hy­dro­car­bons and fast tracks the ul­tra deep­wa­ter east coast de­vel­op­ment, it would be un­re­al­is­tic to ex­pect rev­enue from it in less than five years.