5th August 2019
Confronted By A Hobson’s Choice, What Should Allen Chastanet Do About Grynberg’s US$500 Million Lawsuit?
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By St Lucia Star
St Lucia Star - Almost from its inking in March 2000, the agreement between RSM Production Corporation and Kenny Anthony has been delivering mind-boggling twists and turns. Born in impenetrable darkness, it came to light when for the very first time the people in whose name it was ostensibly established received word of a secret arrangement between a notorious American oil speculator and the day’s prime minister.
The official whistleblower was Richard Frederick. As part of his budget address on April 27 2009, the Castries Central MP revealed: “Madam Speaker, we came upon the agreement while exploring sources of energy. On page 3, at Article 2, it says: ‘By this agreement the company is exclusively authorized to carry out exploration operations in the agreement area . . . and if a commercially exploitable petroleum reservoir is discovered during the period the company is exclusively authorized to conduct development operations.’ ”
Additionally: “The government grants the company an exploration license covering its interest in the agreement area for an initial period of four years from the effective date, subject however to force majeure provisions of Article 24. Upon application made by the company, the exploration license shall be renewed for two further periods of two years each . . . Each development license referred to in Article 8 shall be granted for an additional period of thirty years. Upon application duly made by the company, each development license shall be renewed for a further period of twenty years.
In other words, the last Minister for Finance tied down sweet Saint Lucia, the waters of sweet Saint Lucia, for fifty-eight years, and worst of all, to a con artist.” In the same address before parliament, the Castries Central MP hinted at his government’s intention “to get out of this agreement,” a decision he said would cost US$2.1 million. He blamed it all on “the recklessness of a Minister of Financial Destruction.” The full opposition contingent was in the House when Frederick delivered his blistering condemnation of the secret arrangement between RSM’s chief executive officer and Kenny Anthony, including the former prime minister and Minister of Finance. But it was the Castries East MP Philip J. Pierre who reacted to the shocking unveiling—on a point of order of relative insignificance. Frederick had mentioned by name one of the three individuals involved in the surreptitious oil deal, and the great defender of absentee underdogs was having none of that.
“Madam Speaker,” he said, his voice cracking, “I hate to do this, but it is not fair for the honorable minister to accuse a gentleman who cannot defend himself in this honorable House. Mr. Earl Huntley is no longer an employee of the government of Saint Lucia. If Mr. Huntley at the time [of the signing of the contract] was a permanent secretary, and acted on behalf of a company, there is nothing that says when Mr. Huntley leaves the government he can or cannot act for the company . . . Leave Mr. Huntley. If you want to do your political thing, do not accuse someone who cannot defend himself. Mr. Huntley has family; he has friends.” (Pierre carefully forgot to mention that among Huntley’s family and friends was, wait for it, a foreigner!)
His statement was nonetheless disturbing. But Frederick would not be distracted. He quickly established he had been reading from official documents. “When you see one letter written by someone in an official capacity,” he added, “then another letter on the same subject by the same individual now in a personal capacity, well, Madam Speaker, it certainly raises questions.”
Soon after Frederick’s revelations in parliament several articles by Earl Huntley appeared in the Voice newspaper, one entitled, “The Search for Oil and Gas in Saint Lucia.” Kenny Anthony took to the airwaves to announce his decision to file a libel suit against Frederick and to warn others not to repeat any of what the MP had said while covered by House privilege. He took the opportunity to say, contrary to Frederick’s assessment, that Grynberg was obviously not a con artist. Otherwise, other regional governments wouldn’t dream of engaging him in business. He referred the doubting Thomases to Huntley’s earlier cited published accounts. Since then the former prime minister has kept to himself whatever else he knows about honest Jack.
Not long before the 2011 general elections, Prime Minister Stephenson King delivered a televised address to the nation, at the heart of which was a plea to his predecessor for information that might help the government decide what to do about the Grynberg contract. King prayed in vain. His party lost the general elections and a short time afterward the returned Kenny Anthony announced by press release that Jack Grynberg’s RSM Production Corporation had served a US$500 million breach of contract lawsuit on the government—which would be “vigorously defended.”
At last count, Saint Lucian taxpayers had already coughed up millions for legal representation. In 2013 the prime minister received from Jack Grynberg a letter that the writer described as “an effort to resolve the pending ICSID dispute”: Grynberg would abandon his lawsuit if Saint Lucia “agrees to affirm that the parties’ March 2000 agreement continues to be in full force and effect, and has been so since March 2000.” Also that the government acknowledges “the agreement has been and continues to be in a force majeure due to the aforementioned boundary disputes.”
Whatever was Kenny Anthony’s reaction, it did not please RSM’s chief executive officer—at any rate, not nearly as much as had the amendments to the original 2000 contract. It would hardly be surprising to learn few Saint Lucians know that mere months after the deal was sealed, Jack Grynberg, citing his contract’s force majeure clause, informed Anthony by letter that his company could not fulfill its contractual obligations, by which he referred to “border disputes” involving Barbados, Martinique and other sister territories. In the same bad news missive, Grynberg requested adjustments to his contract, both in relation to time and acreage to be explored. The prime minister signed on the dotted line —no questions asked.
In April 2019, shortly before the announcement that the ICSID’s ad hoc committee had restored to Jack Grynberg his right to have his lawsuit heard on its merit (it had earlier been dismissed by a tribunal “with prejudice” after Grynberg repeatedly refused to comply with its order to guarantee possible costs), he wrote to Prime Minister Allen Chastanet a letter that echoed his 2013 missive to Kenny Anthony. In effect, Grynberg would withdraw his lawsuit provided the government agreed to forget all that had transpired since 2000 and start afresh.
From all I’ve been able to uncover, the government told the American where to shove his stick and carrot. But then, seemingly out of nowhere, another twist: According to reliable overseas sources, the government’s magic circle lawyers are concerned about their chances of beating RSM’s lawsuit—for reasons mainly related to Kenny Anthony’s undisputed amendments to the original contract. If my sources are correct, the new attitude would place the Chastanet government between two tsunamis.
What to do? Agree to Grynberg taking up where he left off in 2000, or gamble on the chance of the oilman winning his US$500 million lawsuit? Dear fellow concerned reader, what would you have our government do? I need add that still to be considered is the long elephant-roomed multi-million-dollar question: How did we land in this monster cesspool? Threatening whirlwinds be damned, the prime minister might attempt yet again to consult with his House colleague or with the man who first discovered oil back in 1998—while frolicking with a bikini bombshell in the sea at Dauphin!
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