By NEIL HARTNELL
Tribune Business Editor
Activists yesterday blasted the government’s decision to give the environmental go-ahead for oil drilling in Bahamian waters as “a reckless and irresponsible response” to the country’s debt woes.
Sam Duncombe, reEarth’s president, told Tribune Business that providing the necessary Environmental Authorisation (EA) for Bahamas Petroleum Company’s (BPC) exploratory activities was an attempt at a “quick fix” for the nation’s fiscal and economic woes.
Arguing that tourism and the environment are The Bahamas’ two main industries “whether we like it or not”, she accused successive PLP and FNM administrations of “failing miserably” to protect the country’s natural resources for the benefit of present and future generations.
While The Bahamas stands to earn a royalty fee, calculated as a percentage of each barrel produced, if oil is found, Mrs Duncombe said citizens “need to wake-up from the dream” that they will see any benefit from such proceeds.
Parliament has already passed a law to create a sovereign wealth fund, which would hold the government’s share of oil exploration revenues, but Mrs Duncombe accused it of using this mechanism to convince Bahamians “everyone will get a piece of the action when they will not”.
Her concerns were echoed by Casuarina McKinney-Lambert, executive director for the Bahamas Reef Environment Educational Foundation (BREEF), who yesterday told this newspaper that approving BPC’s exploration activities is “a very dangerous move for The Bahamas and the region”.
She argued that it was “hypocritical” of The Bahamas to permit fossil fuel exploration in its waters given the sector’s impact on climate change, which this nation last year experienced the full brunt of with climate change.
Mrs Duncombe, meanwhile, said the prospect of oil exploration in Bahamian waters had always been treated “as a get-rich-quick scheme” by the government and many citizens when this was not the case.
“It’s a reckless and irresponsible response to the fact we don’t have enough money to pay our debt,” she argued to Tribune Business. “Stop borrowing so much bloody money. It’s not only this government; every government has looked for a quick fix to the monetary issues in this country rather than empowering people to make money themselves and become part of the tourism industry.
“Tourism, whether we like it or not, is our main industry. We need to protect that because it’s our main business, and we need to protect the environment because it’s our main business. We’ve failed to do that miserably, and continually. In 2020 it’s no longer acceptable.”
BPC has stressed that its first exploratory well, which will be dug in waters south-west of Andros near the maritime boundary with Cuba, will only be used to determine the presence of commercial quantities of oil rather than extract it. As a result, the prospects of any spill or impact to the environment are minimal.
With the government poised to add more than $1.5bn to the national debt post-Dorian, taking the direct charge to over $9.2bn by mid-2023, and a national unemployment rate still stubbornly in the double digits, many observers have argued that prospect of discovering commercial quantities of oil is one The Bahamas simply cannot afford to ignore given its need for an economic ‘game changer’.
Mrs Duncombe, though, decried such notions yesterday. “How is it a game changer if we’re being paid a couple of million dollars a year and BPC is being paid billions of dollars a year?” she argued. “And that’s only if they find oil. We need to put that to rest.
“We have an amazing country in terms of its natural resources, and we need to start learning to appreciate them so that they serve us in the long run. That’s not happening with any administration I’ve seen. No one gets it. They’ve given it away here, there and everywhere to the highest bidder.”
BPC has previously said its commercial terms with the Government involve a ‘sliding scale’ of royalty fees, with the rates tied to production (the daily volume of oil, measured in per barrel terms) that is extracted from Bahamian waters. The royalty rates range from a low of 12.5 per cent for 75,000 barrels per day to a peak of 25 per cent for 350,000 barrels per day or more, with a production licence granted for 30 years.
The Government’s share of these revenues would be deposited into a sovereign wealth fund, with the proceeds to be used to benefit the Bahamian people. However, Mrs Duncombe expressed scepticism, adding of BPC’s project: “It’s always been treated as a ‘get rick quick’ scheme. That’s not going to happen.
“For people who believe somewhere down the line that every Bahamian will get a piece of the oil action they need to wake-up from that dreamscape because they’re not going to get it. I think the Government is duplicitous in how they’re portraying this sovereign wealth fund - that everyone will get a piece of the action. They’re not.
“The Bahamian people think they’re going to get a pay cheque at the end of the month if they find oil. They need to wake up. We have nothing to do with BPC except a tiny, tiny piece of the action if they find oil. This sovereign wealth fund is a red herring to make people believe they will get $1,000 a month if they find oil. It won’t happen. Wake up.”
Mrs McKinney-Lambert, BREEF’s executive director, voiced concern that the leases BPC holds for drilling cover areas of importance to both the fishing and tourism industries. She argued that oil/fossil fuel exploration was also incompatible with the fight against climate change, especially since The Bahamas is one of the most vulnerable nations to this.
“I am deeply concerned to hear this news,” she told Tribune Business of BPC’s environmental authorisation permit. “This is a very dangerous move for The Bahamas and the region.
“Hurricane Dorian clearly exposed our vulnerability in the face of increasingly intense climate-fuelled hurricanes that impact our low-lying islands. It was a stark reminder of the dangers of moving ahead with oil drilling or refining.”
Mrs McKinney-Lambert continued: “Last year, The Bahamas declared a state of climate emergency, recognising that we are one of the most vulnerable countries in the world to the adverse effects of climate change.
“In light of this, it is inappropriate and hypocritical to embark on a new industry drilling for fossil fuels in our waters to release into the atmosphere more of the very greenhouse gasses that are driving climate change.
“In addition, the location of the leases for oil drilling are in vast areas of The Bahamas that are critical areas for our fishing and tourism industries. As countless oil spills from the Exxon Valdez in Alaska to the Deepwater Horizon spill in the Gulf of Mexico have demonstrated, oil drilling is a dirty industry that is not compatible with fishing and that jeopardises our reputation as a clean tourism destination.
“It is time to look carefully at this, discuss broadly and transparently taking into consideration the diverse stakeholders who may be impacted, and truly evaluate the risk that oil drilling poses before allowing any drilling to take place. The future of all of us and of future generations depends on it.”