GUYANA said oil companies operating in its exclusive economic zone (EEZ), which were told they had three months to leave the area, have nothing to worry about and are not paying the order any mind. The order came from Venezuelan president Nicolas Maduro, who pledged to permit development around the Essequibo river in Guyana after his government held a referendum over the weekend where voters rejected the International Court of Justice’s (ICJ’s) jurisdiction over the border disagreement between the two countries and backed creating a new state on Guyanese territory. Venezuela reactivated its claim over the 160,000-square km (61,776-square mile) territory in recent years, after the discovery of offshore oil and gas. The maritime border between the two countries is also in dispute.

However Hugh Todd, Guyana’s Minister of Foreign Affairs and International Cooperation, in an interview with the Jamaica Observer on Thursday indicated that those businesses have little to worry about.

“The president has already spoken with the CEOs of the foreign firms here. We are not paying any attention to what is coming out of Caracas,” Todd told the Caribbean Business Report when asked about the order. His rhethoric echoes that of his president Irfaan Ali, who said Wednesday that investors in Guyana have nothing to worry about.

“Our message is very clear: your investments are safe,” Ali said. “Our international partners and international community are ready and they have assured us of their support.”

Guyana insists that the Venezuelan vote is illegal and disregards the order of the International Court of Justice (ICJ) of December 1 which instructed that its neighbour should not take any action to disrupt the status quo that currently exists and that Guyana has administrative responsibility over the Essequibo region. “We have always had jurisdiction over Essequibo. What we see coming out of Caracas is a violation of the rule of international law; that’s how we see it,” Todd added.

Of the companies which will face a fallout if the border dispute escalates into military conflict is US oil major Exxon Mobil, which operates its largest foreign oil project offshore Guyana in the region where Maduro said companies operating must leave in three months. Todd, who had talks with his Venezuelan counterpart on Wednesday, further reiterated that those entities have nothing to fear.

“We are talking about companies operating oil rigs 100 nautical miles offshore. We are not talking about companies close to the shoreline. They are exploring and exploiting the resources within our EEZ, so they don’t have to pay attention to President Maduro; he’s speaking to his population. He cannot instruct oil companies that are duly licensed to operate in Guyana’s exclusive economic zone. He does not have extra-territorial jurisdiction over our territory.”

Guyana, which is currently producing some 400,000 barrels per day of oil and gas, this year received bids for new shallow water and deep water blocks from local and foreign companies in its first international bidding round. The exploration licences for those areas have not been signed.

Exxon Mobil CEO Darren Woods said on Thursday, during an interview on US business news channel CNBC, that he expects the dispute to be resolved within a couple of years through international arbitration. The matter is expected to be ruled on during the first half of 2025.

“It is a matter between nation states and the international community. It has been ongoing; my expectation is that that process will be respected,” Woods said when asked how the dispute is affecting his operations in Guyana. “From our perspective, we know what we need to do in the country. [We need to] develop those resources economically and environmentally responsibly, and do what we have been contracted to do. That’s what our organisation is focused on,” Woods continued, during the interview. A consortium led by Exxon Mobil began producing oil off Guyana’s coast in late 2019 and exports started in 2020.

Still, there is unease among the Guyanese business community, though there is no disruption to their operations since Maduro’s announcement or Sunday’s vote. Komal Singh, chairman of the Private Sector Commission (PSC), the Guyanese umbrella private sector lobby group, told the Caribbean Business Report that his members are very concerned.

“The private sector stands in full solidarity with the Government and people of Guyana. The private sector, while concerned, continues to do business as usual. Investor confidence is still high. The PSC will continue to do our part to make sure that this controversy doesn’t escalate to a stage where it starts to have a negative impact on the people, economy and businesses,” Singh said.

He added: “This region is a very peaceful region and Guyana, like many of our Caribbean brothers and sisters, are peaceful people. We do not want conflict. Venezuela and Guyana have shared a very close relationship in many forms and fashion in the past. We have had a lot of Guyanese going to Venezuela when things were not good here, and we see a lot of Venezuelans reciprocating right now… and the Government and people of Guyana have embraced them into our country with open arms.”

He said Maduro’s order has no bearing on how companies are operating at the moment.

“That has not affected the progress and day-to-day operations of any company that is operating here, be it local companies or foreign companies.”

Another Guyanese businessman, Vickram Oditt, called the Maduro order “hot air” but admits that businesspeople in the Essequibo region who mostly operate in the mining and forestry sectors are watching to see the developments. Oditt operates a farm in the southern part of the Essequibo region closer to Guyana’s border with Venezuela and said he is exploring an investment proposal to build a large hotel in the region.

Tamesh Jagmohan, who is the CEO of Caricom Rice Mills and Pure Harvest Inc, suppliers of rice to Jamaica, called the situation “very, very worrying”, telling the Caribbean Business Report on Thursday, “I’m hoping that good sense prevails and that Venezuela honours the ICJ and all the legal remedies that are available to the two countries for a peaceful end result that is beneficial to both nations.”

The calls come as the White House on Thursday reiterated the United States’ “unwavering support” for Guyana’s sovereignty amid growing border tensions with Venezuela.

“We absolutely stand by our unwavering support for Guyana’s sovereignty,” White House national security spokesperson John Kirby told reporters, adding Washington supported a peaceful resolution to the border dispute between Venezuela and Guyana.

The United States has also said it would conduct flight operations within Guyana that build on its routine engagement. The US Southern Command, which provides security cooperation in Latin America, was scheduled to conduct flight operations with the Guyanese military within Guyana on Thursday, the US embassy in Georgetown said.

US Secretary of State Antony Blinken spoke with Guyanese President Irfaan Ali late on Wednesday, the State Department said earlier.

Analysts and sources in Caracas have said the referendum was an effort by Maduro to show strength and gauge his government’s support ahead of the 2024 election, rather than representing a real likelihood of military action.

South American countries on Thursday urged Venezuela and Guyana to seek a peaceful solution to their territorial dispute over the Essequibo region, warning the nations to avoid “unilateral actions” on the conflict.

Members of the Mercosur trade bloc “express their deep concern at the rise in tensions between the Bolivarian Republic of Venezuela and the Cooperative Republic of Guyana,” said a joint statement from the bloc’s member countries Argentina, Brazil, Paraguay and Uruguay.

Non-Mercosur members Chile, Colombia, Ecuador and Peru also signed the statement.

The countries urged both parties to “engage in dialogue and seek a peaceful solution to the dispute, in order to avoid unilateral actions and initiatives that could aggravate it”.