Guyana warns of Venezuelan military escalation

Market: Crude oil
29/01/21

Guyana is warning that Venezuela has expanded its military presence in oil-rich maritime territory off Essequibo province.

The Essequibo region that covers the western two-thirds of Guyana is the subject of a longstanding territorial despite. Under a license issued by Guyana, ExxonMobil is currently developing an oil block that partially overlaps the disputed waters.

Georgetown is investigating reports that Venezuela's navy has seized another fishing vessel after two others were taken in early January to the port of Guiria, Guyana's foreign minister Hugh Todd warned in a speech before the National Assembly yesterday.

Venezuela took custody of the fishing boat Miss Annie and the seven-member crew after they were discovered illegally fishing in Mariusa, Tucupita municipality in the river area of Delta Amacuro state, the country's armed forces said on 25 January, noting that the vessel was carrying 500 liters of diesel in addition to fish.

Guyana maintains the fishing vessels that were seized earlier were in its territory – a claim refuted by Caracas. Trinidad and Tobago has said it mediating the dispute.

Canada, the Organization of American States (OAS), regional trade group Caricom and Guyana's opposition have joined the US in rejecting Maduro's intention to seize the Essequibo province.

"Following the announcement by President Maduro, there was increased activity in Guyana's maritime space by Venezuelan navy vessels and other Venezuelan state assets," Todd said, without specifying what assets he was referring to.

Venezuela should "desist from actions that violate international law and threaten the peace and stability of the region," he said.

Guyana has deployed more troops along the disputed border, the government said on 14 January. This followed a government agreement with the US to beef up its military capacity and joint coast guard exercises.

The 120-year-old dispute flared last month after The Hague-based International Court of Justice (ICJ) agreed to arbitrate Guyana's request for validation of its border with Venezuela, after which Maduro vowed to "reconquer" the Essequibo province.

Caracas maintains that the ICJ has no jurisdiction over the matter.

Venezuela's actions "will seriously undermine the peace and security not only of Guyana and Venezuela, but the entire Caribbean region," Caricom said.

Caricom's statement "not only contributes to an ominously hostile climate, but also supports the interests of US transactional corporations that seek to take control of an un-demarcated territory based on an undesirable conflict in the region," Venezuela's foreign ministry said.

The dispute involves a part of the deepwater Stabroek block where ExxonMobil has made several discoveries since 2015, estimating recoverable resources of 9bn bl oil equivalent (boe), and from which it is producing 120,000 b/d of light crude.

The US major forecasts 750,000 b/d of oil production from the block in 2026.

In 2013, Venezuela's navy briefly seized a research vessel working in the Roraima block under contract from US independent Anadarko. And in December 2018, ExxonMobil suspended seismic surveys on a part of its acreage license after a research vessel it contracted was approached by a Venezuelan navy ship.

By Canute James

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Cop: German opposition pushes for Article 6

Berlin, 14 November (Argus) — Germany's main opposition parties have welcomed the progress achieved on Article 6 of the Paris Agreement in at the UN Cop 29 climate summit in Baku, Azerbaijan. They have called on Germany and the EU to make better use of the instrument to allow for more cost-efficient climate action. Germany's dominant opposition party, the right-of-centre CDU/CSU, on 14 November commended the framework under Article 6 as an efficient way of reducing greenhouse gas (GHG) emissions. Article 6 of the Paris accord aims to help set rules on global carbon trade. The Article 6 mechanism allows for reductions to happen where they are quickest, cheapest and easiest to be carried out, the CDU head of the working group on climate action and energy, Andreas Jung, said in a debate in the lower house of parliament, the Bundestag. The deputy head of the FDP faction Lukas Koehler, also speaking in the Bundestag on 14 November, called on Germany and the EU to "finally" integrate the Article 6 in their climate action plans. Koehler argued that if for instance Germany's progress in emissions reduction should turn out to be too slow, the country could temporarily shift its efforts — and the associated finance — to where more rapid mitigation might be achieved, such as Brazil. The EU, of which Germany is a member state, will not make use of Article 6 credits, at least until 2030, to reach its so-called nationally determined contribution (NDC) – its climate action pledge — under the Paris climate accord. The EU has been seeing progress on ongoing Article 6 negotiations at Cop 29, the European Commission's principal advisor for international aspects of EU climate policy Jacob Werksman said today, "mostly because parties are now agreeing with the EU and others that were concerned about the transparency and accountability of the bilateral markets that operate under Article 6.2". Werksman believes there is enough momentum for negotiations to be concluded next week, noting that the atmosphere has "improved" compared with previous negotiations, which echoes the sentiment expressed by a number of negotiators earlier this week . Werksman pointed in particular to the US now agreeing with others and helping to broker compromises. Koehler also warned German government representatives in Baku to refrain from "expensive" pledges which may strain the country's budget. Developed countries agreed in 2009 to deliver $100bn/yr in climate finance to developing nations, and Cop 29 is focused on the next iteration of this — the new collective quantified goal (NCQG) . In a statement, Germany — represented by Scholz despite his absence at the Cop — and other G7 members like Canada, France, or the Netherlands agreed that "developed countries must continue to take the lead and live up to existing finance commitments". Germany faces early elections as the government lost its majority last week following the sacking, by chancellor Olaf Scholz of the Social Democrat SPD, of finance minister Christian Lindner of the pro-business FDP party and the FDP's subsequent withdrawal from the ruling coalition. Polls suggest that the CDU/CSU group will easily win the next federal elections which are scheduled to take place on 23 February. The FDP's persistent refusal to allow Germany to take on more debt to enable more public funding, including of clean technologies, was the main reason for Lindner's sacking. By Chloe Jardine and Victoria Hatherick Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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IEA sees wider oil market surplus next year

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