Latest update March 17th, 2025 4:16 AM
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- EITI urges Govt. to show how money from extractive sector is being used
- ExxonMobil agrees to pay 10% taxes, 10% royalty for small oil blocks
- US deports hundreds of alleged Venezuelan gang members despite court order
- 4 Guyanese arrested after 6.3 tonnes of cocaine found on Guyana-flagged vessel off West African Coast
- Guyana’s oil exports skyrocket—and Europe’s refiners love it
Nothing is for free… ExxonMobil will recover every cent spent on training and employing locals
Suppose you’re working at a company and you’re sent on a training programme for three months. When you return, you use your skills to enhance and uplift the profile of that company. But how would you feel if the employer takes back every cent he spent on training from your salary?
This is exactly what is happening in the case of Guyana and ExxonMobil. The company has a contractual responsibility to employ and train Guyanese to be part of the oil and gas sector.
But the contract allows for ExxonMobil to recover every dollar it invests into capacity building, training facilities and funds to employ locals. What is also interesting is that the company does not need the approval of the Minister to recover these funds.
The Guyana-ExxonMobil agreement says, “All costs and expenses incurred by the Contract in training of Guyanese personnel and such other amounts as may be expended on training under Article 19 of the Agreement.”
Government has time and again, boasted about the local content provisions it was able to secure in the contract.
Article 19 provides for a US$300,000 payment by ExxonMobil to the Government. This is to cover Guyanese personnel who would be nominated by the government to do on the job training in the contractor’s operations, to send qualified Guyanese on courses overseas, to purchase advanced technical books and to send Guyanese to seminars related to the industry. All of this would be recovered by ExxonMobil.
Additionally, the oil giant can also claim for administrative costs for handling the training money and even add interest for borrowing from its parent company. Kaieteur News understands that this kind of borrowing is higher than market rates.
Oil and Gas Experts have informed this newspaper that good contracts limit the rate to the market. But this is not the case in Guyana’s contract.
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