Local Content Policy must detail where training funds from oil companies will go

Local Content Policy must detail where training funds from oil companies will go – GCCI President

Aug 24, 2019 News

The local content policy must detail where training funds from oil companies will go, according to Chairman of the Georgetown Chamber of Commerce and Industry (GCCI), Nicholas Deygoo-Boyer.

GCCI President, Nicholas Deygoo-Boyer

He said this during a roundtable discussion of the third draft Local Content Policy, on Wednesday.
In the various contracts, the Operator Oil Companies are expected to give a set amount of money to Government every year, for the training of Guyanese to participate in the oil sector.
It is the view of Attorney-at-law, Charles Ramson Jr., that Government should invest the funds into the training of local auditors, lawyers and geologists as a priority.
During last Wednesday’s forum, Ramson said that the local content policy is an important element to ensure that Guyanese benefit directly from resource exploitation.
Ramson, who has a Master’s Degree in Oil and Gas Management, had said that an investment in local geologists to have them specialised in Petroleum Operations would give Government the opportunity to assess for itself, the quality of the oil.
Lawyers who are trained in oil and gas, Ramson said, serve to accurately translate Government’s wishes during negotiations with oil companies, to produce robust contracts. Further, the attorney said that such lawyers would be able to identify bottlenecks and loopholes in Guyana’s current Petroleum (Exploration and Production) Act, which inhibit the country’s ability to get the best value for the resource.
As for auditors, they are extremely important to ensure Guyana’s interests are well served, as there are grave concerns about value leakage in the oil sector.
There are concerns that are important to note, about the amount of money being given to Guyana by oil companies. They have been described as pittances.
As for ExxonMobil’s subsidiary, Esso Exploration and Production Guyana Limited (EEPGL), and its two partners on the Stabroek Block, Hess and CNOOC/NEXEN, the government comfortably accepts US$300,000. But in the case of Liberia, Exxon is required to hand over US$750,000 plus a US$500,000 IT support fee.
In the case of Tullow and its partners on the Orinduik Block, US$25,000 is required as payment per year.
Tullow Oil is not the only company from which Guyana accepts a pittance when it comes to funds required for the training of locals.
With respect to Repsol, which is operating Guyana’s Kanuku Block, the Guyana Geology and Mines Commission (GGMC) collects US$30,000. In the case of Anadarko, which holds the licence for the Roraima Block offshore Guyana, the government settled for US$40,000.
In the case of other operators, Guyana collects US$55,000 from Mid-Atlantic Oil and Gas which holds the licence for the Canje block while Ratio Energy and Ratio Guyana provide US$60,000 for the training of locals. CGX, which holds the licences for the Demerara and Corentyne Blocks gives US$$100,000 per block annually.

Discover more from Kaieteur News

Subscribe to get the latest posts sent to your email.

Latest News