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Saturday, February 27, 2021

Oil & gas contributed GY$2.8 billion in revenue to Guyana in 2017

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The recently released Guyana Extractive Industries Transparency Initiative (GYEITI) country report for the year 2017 said with regards to government revenues, the oil and gas sector contributed some $2,860,000,000 (USD14,300,000).

The report which was compiled over the course of 2018 into 2019, documents payments made by companies in the extractive industries as against what government receives.

Guyana submitted its inaugural report to the EITI International Secretariat on April 25, 2019; a milestone in the South American country’s march to becoming a fully compliant member of the Norway-based transparency body.

At a press conference on Thursday May 2, 2019, Minister of Natural Resources and designated EITI Champion for Guyana, Raphael Trotman, lauded the efforts of the GYEITI Secretariat and the Multi-Stakeholder Group in arriving at the milestone of the report’s submission. He expressed the view that subsequent reports will be more comprehensive in scope and inclusive of more areas such as forestry and the fisheries sector.

“The report which was published in conformity with the EITI Standard goes beyond the mere reconciliation of payments and receipts to include contextual information such as a summary description of the legal framework and fiscal regime, the sector’s contribution to the economy, production and export data, state participation in the extractive industries, revenue allocation, sustainability of the revenues, license registers and licence allocations to mention a few,” he said.

Mr. Trotman noted that the identified industries came from the government sector, oil and gas and the mining sector.

He pointed out too that the exercise of gathering information for the report revealed a number of gaps in the management of the information by the various state agencies and expressed confidence that this will be addressed going forward.

With reference to the oil and gas sector, the report said, “Payments are collected by various Government Agencies. Guyana Geology and Mines Commission (GGMC) receives most of the income from petroleum companies through the Petroleum Division. The other payments from the petroleum sector are made to the Environmental Protection Agency (EPA), Guyana Revenue Authority (GRA) and National Insurance Scheme (NIS).”

It said that from the oil companies the GGMC receives Licence Fees, Annual Licence Rental Charge, Annual Training Fees and Annual Assignment Fees; the Guyana Revenue Authority (GRA) and the GGMC receive Royalties; the GRA receives Capital Gains Tax, Property Tax, Corporation Tax and Individual Income Tax, Pay As You Earn, Premium Tax, Value Added Tax, Withholding Tax, Tributors Tax, Transfer Tax, Expatriate Income Tax, Excise Tax, Suspense Tax, Customs Duty and Stamp Duty Signature Bonus.

The National Insurance Scheme receives Social Security Contribution; the Environmental Protection Agency receives Environmental Permit Fees, Licence Fees and Construction Permit Fees while the Ministry of Finance receives Dividends and Revenues from Share Disposal.

With regards to exports and GDP, the report pointed out that the oil and gas sector is still at the exploration stage, which means that there is no production or exports. “Currently there is no contribution of the oil and gas sector to the GDP,” the report said. It is expected that with the coming on stream of oil production in the first quarter of 2020, the revenues and other finances paid to Government and its agencies will increase as will the business of supporting and ancillary services.

It is expected also that employment will increase as more persons who are trained in oil and gas enter into the industry.

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