This discussion about maximum revenues and maximum royalties must happen in the context of the earning potential that Belize Natural Energy's three Mike Usher wells are believed to have. The reserves are unofficially estimated at 20 million barrels of oil, representing potential earnings of over US$1 billion, and that's billion with a "B."
Clearly a company with massive earning potential, so why are they getting tax exemptions? That's right, a company with earning potential far greater than BTL, which is Belize's most profitable and most taxed company, has been getting a string of sales tax and duty exemptions. 7NEWS has obtained the letters from the Ministry of Finance to Belize Natural Energy's representative Marion Usher. They show that on February 6 of 2006, Belize Natural Energy, the oil company, was granted a concession for duty exemption on fuel, of all things!
That's right; the letter says: "the Honorable Minister of Finance has approved the waiver of all duties and sales tax: on...fuel." On March 14th 2006, another letter says that, "the Honorable Minister of Finance has approved the waiver of all duties and sales tax: on three 2006 Toyota pickups."
In total 7NEWS has obtained 9 such duty and sales tax exemption letters between February 7 of 2006 and March 23rd of 2006 and we are assured that there are more. But every letter says that the exemptions are in accordance with the production sharing agreement. And indeed, page 29 of that agreement, the same one in which the government agrees to a 7.5% royalty, shows that Belize Natural Energy is exempted from customs duties on all equipment and supplies, and fuel, just one more so-called "standard feature" in an agreement singed on second January 2003, by Minister of Natural Resources John Briceno.
