Guyana should not hire companies over which Exxon has significant influence - Dr. Mangal

Guyana should not hire companies over which Exxon has significant influence – Dr. Mangal

Feb 04, 2019 News

By Kiana Wilburg

While the Government may be eager to hire international firms to provide much needed advice and expertise on managing the nascent oil sector, it must still exercise extreme caution. This is according to Oil and Gas Consultant and former Advisor to the Government, Dr. Jan Mangal.
In fact, the Petroleum Consultant stressed that Guyana should not hire any company over which American oil major, ExxonMobil, has significant influence or the authorities would need to have mitigation measures in place to counter potential biases and sway.

Oil and Gas Consultant, Dr. Jan Mangal

Dr. Mangal’s comments come in wake of an article that was carried in Sunday edition of the Kaieteur News with the headline, “Lone UK bidder for Govt. Consultancy works for ExxonMobil, other major players…” In that news item, Kaieteur News exposed the fact that the UK firm, Bayphase, is bidding for consultancy works that was tendered by the Ministry of Natural Resources Ministry.
In light of this, Dr. Mangal said that Guyana cannot ensure these companies will look out for the nation’s interests over those of Exxon.
“From the Kaieteur News research, it seems Exxon has influence over Bayphase. Any firm which has Exxon, their partners and contractors as major clients will likely side with Exxon before Guyana (such as WoodMackenzie, Rystad, Intecsea-WorleyParsons, Bayphase, etc.)…”
Dr. Mangal is of the view that the Government should not hire this little known company which seems to have links to Exxon. Should the administration hire this firm, Dr. Mangal believes it could lead one to the assumption that the Government is working for Exxon’s interests.
But the Petroleum Consultant concede that it will be difficult to find firms in the oil and gas sector without links to Exxon. Be that as it may, Dr. Mangal said, “We must choose the most reputable, and those which have a proven track record of being unbiased. We need firms which can prove they have supported the interests of counties versus major oil companies like Exxon. Guyana can afford to pay top dollar now for the best.”
He added, “I recall the Ministry of Public Infrastructure hired a one-man show for their natural gas study, and that was a flop. And the Ministry of Natural Resources hired a firm to review the Field Development Plan for Liza Phase 1, but the choice was inappropriate. The firm could not even review the cost.”
LONE UK BIDDER
Last week, Bayphase Oil and Gas Consultants responded to the Ministry of Natural Resources’ call for consultancy services. It tendered a bid to the tune of US$281,000.
But a simple perusal of the company’s website reveals however that it is a client of ExxonMobil, the US oil major that is leading the exploratory works in the prolific Stabroek Block.
The UK firm which was established in 1986 is also a client of NEXEN, a subsidiary of the Hong Kong based China National Offshore Oil Corporation (CNOOC). CNOOC holds 25 percent interest in the Stabroek Block.
Bayphase also works for Exxon’s subcontractors which include Schlumberger and Technip FMC. (See link for full list of clients: http://www.bayphase.com/clients-list2.php)
Further to this, none of its reports are unflattering to its clients. (See link to view their published reports: http://www.bayphasedata.com/reports.php)
Be that as it may, the company offers several services on a consultancy basis which include: resource auditing and valuation, cost auditing and estimation, reservoir modeling and strategic study.
With respect to Resource Auditing and Valuation, Bayphase said that this aspect covers resource assessments for all types of hydrocarbon properties including exploration development and production licenses. It said that it has extensive experience in carrying out this work for conventional oil, non-associated gas, gas condensate, heavy oil, and shale gas resources.
It said, too, that it has carried out this work in accordance with standards set by these bodies: The Petroleum Resources Management System (PRMS), the Securities and Exchange Commission, the London Stock Exchange, the Alternative Investment Market and the Johannesburg Stock Exchange.
In the area of Cost Auditing and Estimation, Bayphase boasted of having over 30 years experience in developing independent cost estimates, verifying cost estimates and the development of software for cost estimating for oil and gas projects. It claimed to be a recognized leader in the assessment of all costs associated with oil and gas projects. It said that its experience in developing accurate cost estimates covers all phases of oil and gas extraction including: Exploration, Appraisal, Development, Production and Abandonment.
Bayphase said it has also been called on to audit project expenditures on behalf of stakeholders including: Partners in hydrocarbon development projects, Banks providing loans to Oil and Gas projects and Governments who wish to understand the revenue flow in such projects.