OCEANA Claims GOB Gave Princess Energy Special Oil Concession

4 weeks ago, 7News told you about the interim win that Oceana Belize got in the Supreme Court over the Government of Belize in relation to their challenge to several of the offshore oil exploration contracts issued in 2007.

Well, today was set as the day where the government crown counsel was to present a new strike out motion in which they were going to challenge the validity of Oceana Belize's expert witness's opinion on the conduct of a responsible government when issuing oil contracts.

But, there was a surprising development in which the government crown counsel announced to Justice Oswell Legall that GOB would no longer challenge this expert witness, which means that this case will be argued to completion in open court.

But the news tonight is not that Oceana has gotten their day in court, which is scheduled for October 24 and 25. It's their unearthing of a September 2009 contract which amended the agreement between the Princess Group of Companies and GOB.

In this contract, which is signed by the Minister of Natural Resources, Hon. Gaspar Vega, and witnessed by Andre Cho, the Director and Inspector of Petroleum, the Princess Group has exclusive rights to maintain their licensed area.

You would ask well, what is the problem with that? They are a company after all, and they need to secure their investment.

Well, by law, every company must give up a part of their licensed area after every contract term. This is to ensure that the company is only exploring for oil in the most profitable areas.

Princess has not given up any of their area like every other company in Belize, and Oceana has an issue with that specifically because these areas are important to Belize's heritage - specifically, the Lighthouse Reef, the Great Blue Hole, and other UNESCO World Heritage Sites.

Here's what the Vice-President told us today:

Audrey Matura-Shepherd - VP, Oceana Belize
"One of the things that has come out of this case that we think is important for the Belizean public to know, is that there has been an apparent secret agreement between the Government of Belize and Princess Petroleum Oil Company. Now, I say secret agreement because that agreement was signed on September 15, 2009. We began dealing with this campaign on this issue since 2010. We only got access to some of the contracts, and we kept writing the Government under the Freedom of Information Act, asking them to tell us what else there is. We wanted maps and other important things. None of our official request was ever honored. So, we never got anything official. it is - imagine - until 2012, as a result of us having to go to court, that then - in one of the affidavits of Andre Cho - we get to see a copy of an agreement that was never disclosed previously, and could see why it wasn't disclosed previously. The agreement - clearly, I find it very offensive because what it says is that while the law has required that there be mandatory relinquishment - and what that means is that there's a whole block. It's like you're getting thousand acres of land, but every contract term - which is every 2 years - you need to give up a part. That's the part where you never did anything, with the hope that as you zoom in to the area where you think you have oil, what you stay with is a really productive area. But we noticed that since 2010, every time we got a map, Princess never gave up anything. We kept asking why and we never got an answer. Now, through this case, we got an answer, and that's because the secret agreement says that unlike what was in the initial agreement that was signed in 2007, where Princess had to give up 25% of their contracted area, they don't have to give up any now - zero percent. And that would explain why all the other companies have to be giving up - or relinquishing, as it is called in the oil industry - portions of their contracted area, Princess has not relinquished any. And to me, that is contrary to the legislation because the legislation says that you must mandatorily give up a portion. I don't know that zero is a number that reflects any portion. So, they are not giving up anything. But what one of the most offensive parts about drilling offshore is that the contract areas cover our national parks, our World Heritage Sights, and our special tourist destinations. One of them is the Blue Hole. Princess has a concession over the Blue Hole. The Blue Hole is the Lighthouse Reef and it is a World Heritage Sight where the Halfmoon is a national monument. These are not only historically important to us along with their importance of biodiversity, but internationally important us as well. It's a major attraction. We were hoping that through the relinquishment, that at minimum, we would preserve the dignity of these national monuments by having these areas no longer under any private contract held by any oil company. But, we never saw the map changing, so it means that after so many years, they have rights to go drill over the Blue Hole."

This evening, we contacted Andre Cho via telephone and he told us that in the case of the Princess Group, they approached GOB in 2009 and requested an extension and a waiver of the mandatory relinquishment of their licensed area.

Their reason was that they didn't have enough time to properly explore the area for oil, and as a result, they needed more time to see if they are profitable areas.

Cho said that this is something normal and often considered only once for each company because the authorities inspect carefully that there are circumstances outside of the companies' control which prevented them from exploring properly. He stressed that there was nothing irregular about the agreement.

Cho said that as a result, GOB granted this waiver, which this unearthed contract reflects.

He also stressed specifically that parts of these licensed areas for Princess will decrease by the end of September 2012 because the GOB will not grant another extension to them.

He said that as soon as it is possible, there will be a new petroleum map which will reflect the change.

Channel 7