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Icon May 6, 2011 - 00:00 Icon - 3 comments

Advantages and Disadvantages In Drilling Oil In Belize

Advantages and Disadvantages In Drilling Oil In Belize

There Are Some Advantages and Disadvantages In Drilling Oil In Belize And We Should Weigh All Of Our Options
By: Wellington C. Ramos

It is being said for years now that our country of Belize possess oil and other natural resources in vast quantities but the problem is that only a few families in our country know exactly where these resources are. Most of these families are people who have relatives in government that are privy to this type of information in the past and present.

In Belize there are several citizens who have and continue to apply for lots and lands and are continually being denied without any good justifiable reason. Yet, the same families that already have enough land, continue to apply and are given additional lots and lands to add more to their vast land reserves. There is a strong possibility that these same families are applying for lands based on information provided to them by their family members, that these lands possess oil and other natural resources. If this is the case, then the working class and poor Belizean families will never be able to benefit from our country’s oil and natural resources unless we nationalize some of our industries.

When some people hear about nationalizing some of our industries they label it as something bad for the private sector or businesses. However, a good government must always put the interest of its citizens and the nation’s first before they decide to make that move as was recently done with BTL. A government that is not inclusive and serving the best interest of the majority of its citizens could be deemed as undemocratic and eventually will make itself volatile to civil unrest by a majority of its citizens.

I am a strong believer that governments serve a good purpose and that is to provide many opportunities for their citizens to have the means to become productive citizens. The government of Belize must continue its efforts to provide; employment, security, liberty, education, quality health care, lots, lands, safety, and a clean environment to all its citizens. The government of Belize can only provide these essential needs with revenues they will gain from extracting our natural resources and using them towards our industrial and technological development to limit our importation of goods and services.

Many years ago in Belize, the government had several governmental departments that played a vital role in building our infrastructure and contributed towards our development such as Agriculture, Fisheries, Public Works, Lands  and Forestry. Most of these departments have been privatized or downsized and their duties and functions transferred over to private companies or by people related to members of the government which can be considered as a conflict of interest. In some cases the cost to the Belizean taxpayers is a lot higher than when the government provided some of the products or services. In the last administration, almost all of the remaining assets for the government and people of Belize were sold out completely.

Currently, there is a coalition in Belize seeking signatures from the Belizean citizens to ban Offshore Drilling in the county of Belize. To drill or not to drill oil in a country is a decision to be made only by the people who were elected to serve by the citizens of the country and in Belize that is the House of Representatives and the Senate. A Referendum, if allowed, could be challenged in court by the government on the grounds that such a decision is the constitutional responsibility of the elected government. This organization has given the following five reasons to ban drilling which are as follows:

1 - Belizean Laws do not allow for class action suits and only the Attorney General can bring about a case on behalf of the people who are injured.
2 - Petroleum companies have more rights over our land than we the citizens and the taxation is too small.
3 - There is no transparency in awarding contracts to prospective oil industries.
4 - Protected areas could be encroached upon because of the lack of an Enforcement Agency and
5 - No independent Regulatory Board to regulate and enforce all the laws that are related to drilling in Belize.

All five of these concerns are legitimate and are resolvable through the passing of additional legislations in the House of Representatives and the Senate. After the laws have been passed, Regulatory Boards and Enforcement Agencies could be established. The discovery of oil in our country is something new and we should take every opportunity to be cautious but yet open minded about the benefits that it can bring to our people and country rather than be engaged in setting up road blocks to make it beneficial to us. I am also afraid that some of these political interest groups might be influenced by some political parties or other individuals to reserve drilling until a party they support come to power to issue them their drilling licenses.

When the previous government was in power, they were allowed by the then opposition the United Democratic Party to freely explore all the avenues that existed to drill oil in our country so that we can gain additional revenues for our people and nation. Now, we have discovered that most of those contracts that were issued then had clauses giving our country a small percentage of the total revenues garnered. Pretty soon those companies contracts will be expiring and we will have the power to raise their taxes, not to renew their contracts, seek new companies or renew their contracts.

Belize is indebted to the IMF in the amount of 1.1 Billion Dollars which is known as the Super Bond Debt and we must find a way to repay this money if our country and our young generation will have any future. The current revenues that we take in annually are not sufficient to deal with this debt and we must find additional revenue sources to survive.

The government knows where all the oil, gas and natural resources are and the possible potential earning capabilities. If certain Belizean families and prospectors can have this information to their access, then all Belizean citizens should likewise. As our population continues to increase, our citizens will be making more demands from our governments whether it is UDP, PUP, VIP or BNP and without the revenues, none of these political parties will have the capacity to deliver for the needs of our Belizean citizens. People are tired of promises, rhetoric and sweet talk especially when their children have no food in their stomachs and jobs are not available for them to earn money to pay their bills.

Comments
May 12, 2011 - 19:37

I'm assuming this is Mr.Ramos again .... Whatever interests groups you work for are obviously shoving the idea of oil as the one and only option as the "wealth" bringer of Belize. Stop waving the shiny object at the Belizean people as if it's going to make their lives and livelihood much better. 

You obviously have not been doing your homework on other possible ways of income for this country. So, I propose to you again, perhaps turn your thinking into renewable sources of energy that are less dramatic and invasive. Belize is blessed with costal waters and abundant sunshine. Why not invest on solar and wind power? Get us off the grid from whatever country we get our electricity from. 

As for leasing land for oil drilling or natural gases, look at the data, "fracking" as it's called has contaminated drinking water with chemicals and methane to where the water is flammable and undrinkable. Is this what you want for Belize? I hope not, the extraction of fossil fuels on the earth have environmental impacts that affect the health, community and welfare of a nation. The people who live in areas that are leased to oil companies see little to no income from the drilling and fracking from the land. The bulk of the money goes to the oil companies. So, it really looks like you are more than willing to take a risk and put a blind eye on all this risk factors all for the sake of "wealth." Think about what it is that you really stand for, think about you will be sacrificing for this idea of oil drilling. The people of Belize I believe have spoken and they are not for oil drilling. Is this what you really want for Belize?

May 8, 2011 - 22:56

To Mr. Ramos,

One thing you left to mention on your one-sided quest to allow oil-drilling in Belize is that unlike the US and other post-industrialized countries is that if there was a huge oil spill with similar magnitude like in the Gulf, Belize does not have to resources necessary to clean up the mess. Second, you are completely missing the fact that the #1 industry in this country is Tourism. If Belizean waters become tainted with crude oil then tourists will not come to Belize and provide revenue. Think about all the wildlife that will be affected. You cannot change the livelihood of people on a whim, especially when you try to sell oil as if it where clean and safe. You forget to mention about waste if any and provide well informed data that would otherwise say so. You also forget to provide a plan if an oil spill were to occur, is there an organization that will provide such service? 

As for your argument that previous governments have done nothing but to secure their own interests is null. Nepotism and Cronyism has existed in the Belizean government since the very beginning, why? because the country is still young and corruption is abundant. This will not change until the right people with well established academic background are elected and make educated decisions. Adding oil into this picture will not change that aspect of government.

So this is what i propose to you - why not for the so called "betterment" of the country of Belize that you are so concerned about, produce a massive scholarship for the young people of Belize to become educated and think for themselves. Why not propose for the government of Belize to increase the number of their citizens to actually become educated in careers that can better assess the pros and cons to oil drilling? Belize can only move forward in economy if the people are innovate and educated not from oil drilling. Increase taxes by 1-2% on the richest in the country and provide education opportunities for the masses.

From someone who will not buy anything you are trying to sell.

May 6, 2011 - 20:26

I have to state that the government most certainly does not know where all the oil and gas is in Belize. If they did, it would have been put on production already.

Drilling for oil in Belize will not cause environmental devastation the way that the 'coalition' would have you believe. It is true that the search and production of petroleum in the past has had a very dirty record, but those days are very long gone. There are many countries where there is oil production in pristine areashas been done for years with no detriment to wildlife, flora, fauna, reefs, whatsoever. look at Barbados. No damage whatsoever to their tourist industry from oil production. Look at Trinidad, the world's oldest oil producing nation. Where is the damage to the reef there? Look at the Jurassic coast in UK. Where is the damage from massive oil production. Even the locals don't know where it all is.

Right now BNE is paying windfall tax to the government. Belize is earning millions of dollars from their share, as well as royalties on BNE's share as well as income taxes. BNE employs hundreds of people, and not only this, gives them a good wage as well. other benefits may not be so obvious. Who is up on Pine Ridge right now fighting the fires? BNE, that is who. If an oil tanker was to run aground on the reef, (much more likely than any drilling incident) then who will have spill clean up capability? BNE that's who.

People keep going on about the Nationalisation of oil assets. If that were to happen, oil exploration in Belize will cease immediately.  The government doesn't have the money to drill for oil. Where do the hundreds of millions of dollars come from when the Belizean government is worried that they cannot meet repayments for the super bond? Nationalisation is a ridiculous concept only pushed by those who either don't understand the subject, or are hell bent upon stopping all oil exploration in Belize. Belize DESPERATELY needs the money, and yet there are many in Belize who want to deny the country of any revenue that this would bring.

We then also only hear about oil. What are the objections if we were to find gas?

The objections put forward by the coalition don't hold much water.

1. Most countries in the world don't have legislation to allow for class action suits, and yet oil exploration and production go on there with individuals 'injured' still getting compensated. This is a total red herring. You could bring a class action suit against CHx for instance in the USA as they are the group with the largest share holding in BNE. There are so many more ways to skin a cat.

2. Petroleum companies do NOT have more rights over your land than you do. They have very few rights at all. It is the government that has the rights to all mineral wealth found beneath your land the same as the vast majority of countries in the world. Right now, landowners MUST be compensated for any use of their land. Oil companies HAVE to pay you a percentage should they find something, they HAVE to repair any damage. As for the part about the taxes being too low? Well in the beginning they were. Belize learned a lesson from the original poor PSAs issued and has changed the tax structure. The government is doing very nicely indeed out of the small drip of oil produced at Spanish Lookout.

3. There is no transparency over contrat awards. I am not really sure what this means. if we are talking about the award of exploration acreage, then this is done as a secret bidding process in every country in the world. The acreage is advertised, and sealed bids are submitted. Belize in the past has not gone down this route because before BNE has their small find, oil companies were not in the slightest bit interested in bidding for acreage.They generally still are not. That is why we don't have Shell, BP, Exxon, Hess, Petronas, CNOOC etc beating a path here. once acreage is awareded however the whole business is extremely transparent. Just go to Belmopan and ask to see the documentation. It is easier to get information in Belize than any other country I have ever worked in.

4.Protected areas could be encroached upon. well absolutely they could be. Doesn't mean that the protected areas will be destroyed though. the prescence of an oil company normally increases protection of protected areas. Far more than they are being protected right now. Look at the illegal logging, illegal hunting, rainforest being cleared for milpas. This is happening right now. If there was an oil company in there there would be massively increased security. This argument doesn't wash at all in the real world.

5. No independant regulatory board. Well so what? Are we talking independant of the government? Name me one country that does have an independant regulatory board. The USA? The UK? Norway? Saudi Arabia? Do we really want to pass power to set legislation away from the government to unelected people with a private agenda?

What the coalition of non oil experts needs to be doing is looking at ways to cleanly, safely, and responsibly explore for oil in Belize. Not seek to deny Belizeans of the wealth that it would bring.

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