A day after the official announcement signalling the start of oil production in Guyana, the main opposition party restated its position that the government has done a poor job in managing the emerging petroleum sector and preparing for the influx of oil revenue.
In a statement on Saturday evening, the People’s Progressive Party Civic (PPP/C) said the announcement of first oil by President David Granger “is as transparent as it is hollow” since the current administration did not play a role in bringing US oil major ExxonMobil to the country and has done nothing substantial since coming to office, to bolster the sector.
A Petroleum Prospecting License between Guyana and ExxonMobil along with its joint venture partners Hess and CNOOC, was initially signed in 1999 under the PPP/C, by President Janet Jagan. The agreement was later amended in 2016 under the current Granger administration.
“Having done nothing that resulted in ExxonMobil’s work in Guyana, Granger’s four-plus years of being in charge of the oil and gas sector has proven to be an abysmal failure,” the PPP/C said.
The party said these failures range from the “indefensible re-negotiation of the ExxonMobil contract” to the fact that Guyana is still without the necessary architecture that would guarantee management of the oil and gas sector, where global best practices, transparency and accountability are the order of the day.
“The receipt of a US$18M signing bonus can be considered the most talked about consequence of a poorly re-negotiated contract, since Guyana could have secured a higher sum. However, on this matter, the Coalition’s proclivity for operating in the dark was exposed, yet again. Guyanese can only conclude that this inclination was to allow for corrupt dealings, given the vehement denials from Coalition officials about the actual receipt of the signing bonus,” the opposition party said.
Relative to the architecture of the management of the sector, the PPP/C asserted that Guyana is nowhere close to where it should have been five years since the oil find was confirmed in May 2015.
“First, Guyana has a Sovereign Wealth Fund that was not only hurriedly passed by the APNU+AFC Coalition in the National Assembly, at a time when its authority was diminished as a caretaker government but is lax in several areas. The political influence that dominates this piece of legislation is far removed from what is global best practice,” the PPP/C said.
The party also criticized the government for failing to establish the Petroleum Commission, a Local Content Policy (LCP) framework, and its handling of the sale of first oil.
The Department of Energy has said the LCP will be finalised before the end of this month.
“All considered, Granger’s claim that “Guyana’s future is brighter with the beginning of first oil” rings hollow. The appropriate policy environment has not been created,” the party reiterated.
Guyanese will go the polls on March 2, 2020 for what is being described as ‘the mother of all elections’ considering the start of oil production and the critical role the next government would have to play to ensure the small nation of just over 750,000 people benefit from oil revenue.
