CASTRIES, St. Lucia, CMC – Prime Minister Stephenson King has confirmed that his administration has hired an international law firm as it seeks to get to the bottom of a controversial oil agreement signed between an American oil tycoon and the former St. Lucia government. “My government remains committed to pursuing efforts to identify potential offshore petroleum resources, and we will do so through a fair, competitive bidding process with responsible partners.
“The government hopes that Grynberg will recognize the correctness of the government’s position in respect of the prior agreement. However if it does, not arbitration could ensue, the cost of which would be substantial,” King said.
Prime Minister King said that attorney Brian King of the London-based law firm, Freshfields Bruckhaus Deringer, is providing advice to his administration in the case against RSM Corporation owned by Jack Grynberg.
The government has been seeking to enter into a bidding agreement with another international investor on oil exploration but said that RSM Corporation is unwilling to agree to the termination of its contract for exploring the island’s sea bed.
King warned citizens of a long battle ahead and that substantial to be met by “tax payers of this country”.
He said it is “grossly unfair that former prime minister Dr. Kenny Anthony signed an agreement giving one foreign company domain over St. Lucia’s sea bed for a period exceeding 50 years, while at the same time, no other international investor would be allowed to conduct explorations of the islands waters”.
The Prime Minister said that his government had relayed to RSM that their previous contract had lapsed and therefore would like to close the matter.
“In May 2007 representatives of a Norwegian company met with officials of the Office of Sustainable Development to propose the execution of a seismic exploratory survey in St. Lucia at no cost to the government.
“This same company had successfully completed a similar survey in Barbados in 2006 ahead of their interest in St. Lucia. In June 2007 Barbados announced its first licensing round to international oil and gas companies,” King told reporters.
He said that while the preparatory work for both the Barbados and St. Lucia projects had been estimated at 18 months, there were other constraints facing St. Lucia.
“Preparatory work from a local standpoint included obtaining and reviewing an agreement that St. Lucia was said to have entered with one Jack Grynberg for similar work to ascertain the status of that agreement before committing to the company”.
The attorney told reporters that the government had set out to negotiate a resolution with RSM but so far RSM “had refused to accept.”
St. Lucia was one of five Caribbean states that were involved in agreements with Grynberg for oil exploration in their waters. King said Grenada was able to remove itself from the agreement at substantial costs.
“It took Grenada at least seven years to extricate itself from the Grynberg issue. These international proceedings are a serious matter and will take a lot of time to settle. Realistically it would entail two to three years for such arbitrary tribunal matters to be completed,” King, the attorney added.
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