Within months of taking office in June 1995, Prime Minister Dr. Keith Mitchell and his ruling New National Party (NNP) were engaged in secret talks with U.S investor Jack Grynberg for oil and gas exploration in Grenadian waters.
Well-placed sources told GRENADA TODAY that it was Prime Minister Mitchell and not Deputy Prime Minister and Energy Minister Gregory Bowen who had started the initial talks with Grynberg and his Colorado-based RSM Production Corporation on the possibility of oil drilling.
Grynberg has filed a multi-million dollar law suit in a New York court accusing
Bowen of breaching the agreement after the U.S investor refused to pay him bribe money - a charge vigorously denied by the island's Number Two.
Bowen had served notice of his intention to file a counter suit against Grynberg for defamation of character.
A source who asked not to be named said that during the initial negotiations between Grynberg and the Mitchell government, some senior civil servants had to battle with the administration over its insistence on handing over to the american investor certain documents that were considered as national secrets on oil and gas matters.
"I remember we had some documents that were prepared for us by the Commonwealth Fund for Technical Corporation (CFTC) and the guys (NNP officials) wanted to take them and hand over to Grynberg and them", said one of the top civil servants.
"We had to tell them men that this was madness, you couldn't take what was clearly State secrets and give to a man who wanted to talk with us about oil exploration", he added.
Meanwhile, this newspaper was able to obtain a confidential document which was sent to the Mitchell government, dated December 29, 1995 by Grynberg on the oil and gas deal.
As a public service, GRENADA TODAY reproduces in full the letter that was despatched by Grynberg:
The Government of Grenada
Minister of Agriculture, Trade, Industry
Energy and Production
St. George's Grenada, W.I.
December 29, 1995
Re: Force Majeure Notice
Gentlemen:
In accordance with Article 24 of the Agreement between us dated December 29, 1995, RSM Production Corporation hereby notifies the Government of Grenada of the occurrence of a force majeure event, the adverse claims by Trinidad and Tobago and by Venezuela to the Government of Grenada's ownership or control over in the petroleum in portions of the Agreement Area.
Under Article 24.4, these adverse claims are deemed a force majeure event as to the entire Agreement Area, and thereby excuse performance of all of RSM Production Corporation's obligations under the Agreement and extend the duration of the Agreement and the time allowed for performance or fulfillment of all of the RSM Production Corporation's obligations by the period required to establish beyond doubt the government of Grenada's ownership of and control over, all petroleum in the Agreement Area.
In negotiation today, however, RSM has agreed to reimburse to the Government such direct costs and expenses, not exceeding $400,000, as may be incurred by the Government for third party services in establishing its ownership and control of the petroleum in the entire Agreement Area, although RSM has reserved the right to terminate, in its sole discretion, such reimbursements at any time.
For its part, the Government of Grenada has agreed vigorously to pursue all appropriate means for establishing its ownership and control of such petroleum, and has further agreed that any reimbursement amounts paid to it by Grynberg in connection with third party services shall conclusively be deemed proper expenditures in connection with the Initial Exploration Period which shall directly reduce the minimum expenditure required under Article 4.1 (a) during the Initial exploration period.
Very truly yours
RSM Production Corporation
By: Jack J. Grynberg as President
Accepted and Agreed:
The Government of Grenada
By: Minister of Agriculture, Trade,
Industry, Energy and Production
