Guyana’s problem is that it aspires to be where Trinidad is tomorrow – Exxon’s Rod Henson tells conference in T&T

Feb 08, 2019 News

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By Kiana Wilburg
Guyana is on the verge of becoming a significant player in the international oil and gas industry. But it faces a number of challenges as it moves to develop systems and capabilities to handle the quite technical sector.
According to Rod Henson, Country Manager for ExxonMobil’s subsidiary here, Esso Exploration and Production Guyana Limited (EEPGL), one of the issues facing the country is that it wants to be where Trinidad is “tomorrow” without considering what it took for the CARICOM sister to get where it is.
Henson made these and other remarks at the recently concluded, Energy Conference and Trade show of Trinidad and Tobago. The three-day event was held at the Hyatt Hotel and was organized by TT’s Energy Chamber, a not for profit, independent, a-political membership organization representative of the major petrochemical companies there.
At the event, Henson provided an update on ExxonMobil’s operations offshore Guyana. He also boasted to the stakeholders present of the work his company and its contractors are doing in the area of local content.
The Country Manager said, “Lastly, I wanted to touch a little bit on local content. Very proud of what we and our contractors have done in the area of local content. Trinidad has a long and mature oil and gas industry… Guyana is early in the journey, very early but moving along.
“The challenge has been that, Guyana looks to Trinidad and it aspires to be where Trinidad is or it aspires to be there tomorrow. Without considering that it has taken Trinidad decades to reach this level…”

Even though Henson is proud of his company’s local content efforts, it has been under scrutiny and even attracted much criticism for what it deems to be “local content.”
It was in June 2018 that ExxonMobil provided the Government of Guyana with a list of companies that it used as part of its local content obligations in the first quarter of 2018.
But the list of “registered companies” is padded with the names of 41 individuals; these include Dennis Charran, Mokesh Daby, Colin Daniels, Colvin Lockhart, Kembleton Clyne, Kurt Branker, Ramesh Seebarran, Ganesh Ajodha, Gary De Jesus, and Stan Gouveia.
It also duplicates the name of Ram and McRae, an accounting firm. It is listed as Ram & Mcrae and three spaces later in the document as Rams and McRae.
Speaking with Kaieteur News on the matter, two international local content experts said, “The number of companies used by ExxonMobil is immaterial. The crux of the matter is ‘the value of the investment’ made by ExxonMobil.
In this regard, they said that Guyana’s Parliamentarians should call on the company to give a detailed breakdown of how many companies benefitted from US$1M, US$500,000, $100,000 and under US$50,000.
“With that breakdown, you will be able to see if the country is getting chicken feed or real investment. With meaningful investment, the sectors that support the operations of the company would be able to see real expansion and development,” one of the Local Content experts explained.

DOESN’T QUALIFY
International Local Content Expert, Rene Tissot, had told Kaieteur News that “ads in newspapers and catering and hotel services are low-hanging fruit…”
Tissot said it is important for Governments to understand the difference between local content and spending that benefits the local economy.
“If an oil company wants to do advertising for jobs or advertise something about its local branch in Guyana, then it has to utilize the media in that country. You don’t expect them to put the advertisements in the New York Times.”
Also, there are some services such as those provided by hotels and restaurants that they just don’t have a choice but to use.
“This is money that they would have spent anyway and it benefits the local economy. But please, this is not local content.”
Tissot added, “Local Content on the other hand, goes much deeper than this. The heart of Local Content speaks to the development of local skills, the transfer and use of technology, the expansion of local manpower and the growth of local manufacturing.
“Local Content looks at the ‘value’ of the investment into these areas to such a degree that it is lasting. Local Content promotes industrialization…”
The Local Content Expert said, “The depth of the investment and/or the value of the investment are crucial when referring to something as local content.”
The International Advisor also said that a list with restaurants, hotels and media houses would be best described as “shallow in terms of value creation.”
He said, “I would be disappointed to look back 15 years from now and see that local content in Guyana refers to ads in newspapers, and catering services.”

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