GRA TEAMS UP WITH IMF… Teams to be sent overseas to learn tricks of oil and gas companies

Jan 21, 2018 News

---

By Kiana Wilburg
The Guyana Revenue Authority (GRA) will be taking a proactive approach when it comes to learning all that comes with taxation and the oil and gas industry. This is according to GRA’s Commissioner General, Godfrey Statia.
Kaieteur News understands that training is set for March with teams for the Oil and Gas Unit set to be sent overseas to learn all they can with regard to taxation and how other countries deal with their oil and gas sector.
Statia said he wants to ensure that the Oil and Gas Unit is more than capable and ready for anything that comes its way when production begins March 2020. The Chartered Accountant said that nothing is being left to chance.
He said, “So the training is set for March. We have already commenced some training with the International Monetary Fund (IMF). We have teamed up with them and I believe that it is a good partnership. In fact, the IMF already has a team here. They are training our officers in various areas of taxation.”
“We have also got some aid from the British for training in the same area and help from the Office of Tax Analysis in the USA. What we have to do is look at all the types of taxation and we are looking to get training from all of the countries which have experience in this area so we know exactly, the kinds of things to look for and expect.”
Statia added, “So essentially, we are pulling experience from the USA, UK etc and this mix of experience will no doubt be of great benefit to us. Also, we are currently negotiating to send a team to Trinidad. They have years of experience in this industry. So we are not leaving anything to chance. We have bilateral arrangements with counterparts too…”
RESOURCE CURSE
As Guyana prepares for oil production, the Government insists that it is doing all that is necessary to protect the nation from the resource curse.
In his Budget 2018 speech, Finance Minister, Winston Jordan, said that while the Government continues to build capacity for effectively managing and regulating the oil and gas sector, it will ensure that systems and regulations are in place to properly and transparently account for, and manage oil revenues.
In this regard, he said that an oil and gas unit will also be established within the Guyana Revenue Authority (GRA). The economist said that the Unit will benefit from extensive training in revenue administration within the context of Production Sharing Agreements.
The Finance Minister stated that the prudent management of these revenues, in addition to a well-thought out development plan, will help to guard against the resource curse.
Although oil remains the main focus of this emerging sector, Minister Jordan stated that the Government is carefully exploring the feasibility of utilising natural gas as a temporary alternative for power generation. In the coming year, he said that further steps will be taken to identify the preferred option for transporting gas onshore, including the most suitable location.
Additionally, to prepare the private sector for rapid growth in this sector, the Finance Minister said that the Government will be hosting an Oil and Gas Exposition and Business Summit in the first quarter of 2018, to bring together various segments of the private sector towards creating partnerships and facilitating information sharing for business opportunities.
But it appears however that the main concern for the private sector bodes is the need for legislation which would compel oil companies to use local products and services.
President of the Georgetown Chamber of Commerce and Industry (GCCI), Deodat Indar, recently articulated that Guyana has a short space of time in which to get itself together for the booming oil and gas industry. He said that the failure to address certain critical issues correctly will leave Guyanese businesses out in the cold.
He provided details on the observations he and members of the Chamber made during a recent visit to Canada.
Indar said, “We went there to look at the oil and gas industry not only from a trade perspective but we wanted to understand the local content system that they have there. We wanted to learn how they were able to develop their industry when they found oil in 1966…”
The GCCI President continued, “Because oil production kicks in by 2020, we have a short time span. We want to learn from Canada, how our companies can become part of the supply chain when ExxonMobil gets into full swing. Joint ventures between locals and foreigners will be the fastest way to get there and this mission is to help in that regard.”
“While in Canada, we looked at their legal structure, training facilities, and response facilities in case anything happens and what would be their response time…We met with a whole host of people just to understand the structure they have and how we can replicate their strengths here.”
Indar said that he and the delegation from Guyana were able to see firsthand, how Canada’s private sector is able to successfully play a role in the oil and gas sector.
For that to happen here, Indar insists that legislation is needed.
“We need legislation which says you need to come to us first before you go to the Caribbean and further afield for products and services. If you need water, see if anyone here can supply it first.”
The GCCI President said that if this is not done then Guyana’s businesses will lose out.
“What you need is local content legislation which brings enforcement. Operators may not like it but for development to take place, our local businesses need production. Give us the opportunity to see if we can supply.”

---

---