EITI now demands disclosure of technical, financial criteria used to award contracts

Jun 22, 2019 News

By Kiana Wilburg

Even though it is yet to be assessed since becoming a member of the Extractive Industries Transparency Initiative (EITI), Guyana and more than 49 other members of the international body will be required to follow new and improved rules that aim to significantly remove the opportunities for under-the-table deals in the award of contracts.
These new rules are fashioned into the EITI 2019 Standard which was launched at the recently concluded EITI Global Conference in Paris.
In the area of transparency for contracts, which is just one aspect of the 2019 Standard, implementing countries are required to disclose information related to all contract and license awards and transfers; provide a description of the process for transferring or awarding the license; disclose the technical and financial criteria used; offer information about the recipient(s) of the license that has been transferred or awarded, including consortium members where applicable; and release any material deviations from the applicable legal and regulatory framework governing license transfers and awards.
In cases where Governments can select different methods for awarding a contract or license (e.g. competitive bidding or direct negotiations), EITI members must provide the description of the process for awarding or transferring a license.
There must also be an explanation of the rules that determine which procedure should be used and why a particular procedure was selected.
Where there are gaps in the publicly available information, the 2019 Standard dictates that these should be clearly identified.
It also notes that any significant legal or practical barriers preventing comprehensive disclosure of the information set out above, should be documented and explained, including an account of government plans to overcome such barriers and the anticipated timescale for achieving them.
Where companies hold licenses that were allocated prior to the period covered by EITI implementation, implementing countries are encouraged to disclose the information on whether these licenses were awarded through a bidding process.
The government is also required to disclose the list of applicants and the bid criteria.
SARA PROBE
Even before the launch of the 2019 EITI Standard, transparency advocates locally and abroad, have been questioning the award of contracts and their subsequent disclosure by the past and current administration.
In fact, the State Asset Recovery Agency (SARA) is investigating how two prime blocks offshore Guyana, namely the Kaieteur and Canje Blocks, were awarded to three industry unknowns by former President, Donald Ramotar, just days before he lost the 2015 elections. These firms—Mid-Atlantic Oil and Gas Inc., Ratio Guyana and Ratio Energy Limited—have zero track record in oil exploration and no wherewithal to even drill and develop these blocks that are lodged in ultra deep waters.
The incomprehensible situation leaves transparency advocates drawing several conclusions, the main one being that Guyana’s state assets were victims of a most corrupt backroom deal.
Even though the political opposition has no trust in SARA’s ability to be independent or competent in this regard, others are hopeful that the investigation puts the said issue and related concerns to rest.

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