Exxon's $40B Find Renews Age-Old Feud off Venezuela

(Bloomberg) -- For generations, Venezuela has formally laid claim to most of its tiny neighbor, Guyana. Many dismissed the case, given Venezuela’s oil wealth and Guyana’s penury. Hugo Chavez, longstanding president of Venezuela, even let it slide, referring to the Guyanese as his brothers.

Then in May, Exxon Mobil Corp. revealed that under contract from Guyana it had found massive offshore oil and gas deposits. Chavez’s successor, Nicolas Maduro, demanded that the drilling stop because the area was Venezuela’s. He dismissed Guyana’s president as a tool of Big Oil, declared his statements “nauseating” and Guyana’s actions likely to “bring war to our border.” He withdrew his ambassador, and Guyana announced the end to a long-time rice-for-oil deal.

For Guyana -- which produces no oil and whose 800,000 inhabitants live with unpaved flooded roads and power outages -- the estimated offshore find of 700 million barrels promises a revolution, a shift from negligible food exporter to global energy dealer. The combined oil and natural-gas deposits appear to be worth $40 billion, at least 10 times the country’s gross domestic product.

“We’ve gone through suffering for many decades and our time is due,” Raphael Trotman, minister of governance, said in an interview in his office on an unassuming road in the capital, Georgetown. The discovery is “transformational,” he said. “For us, there is no going back.”

Ordinary Guyanese, who rely on Venezuelan oil, are giddy with anticipation. Staring at a potential jackpot, they also are livid with Maduro, accusing him of trying to evade his economic and political woes by coveting what belongs to them.

“Just Being Greedy”

“Chavez never fought and now Maduro?” said Otis Adams, a 42-year-old heavy-machine operator in the destitute border town of Mabaruma. “He’s a nobody, trying to pass off the worry of his people from all that killing and suffering -- he’s just being greedy.”

Venezuela has the world’s highest inflation, chronic shortages of consumer basics, including medicine and toilet paper, and a murder rate that surpasses Iraq’s. Parliamentary elections are in December, and Maduro’s socialist coalition may lose its majority for the first time in 16 years.


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Copyright 2016 Bloomberg News.


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Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
joe pacheco | Aug. 14, 2015
I believe that ExxonMobil has a great idea to lift up a nation out of poverty, lets see if its not all talk cuz you know talk is cheap. Action for the good of all thats what the world see..lets see what you do..THE PEOPLE

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