‘Big Men’ disappear; small men remain

Jan 31, 2020 Features / Columnists, Peeping Tom

Guyanese have to understand, clearly, a couple of facts. First when the oil companies speak about billions for the field development programmes, they are speaking about billions of US dollars.
Secondly, I hope Guyanese understand that the country has to pay back these billions and cost recovery since they directly relate to exploration of production.
Even before oil production began, Guyana had already owed what is estimated to me US$1B to the oil companies for pre-contract and other costs. So now we have to add on these field developmental costs for Liza 1 and Liza 1.
This column has raised the issue that the public was being kept in the dark over the actual production, which was taking place. The oil companies should have been supplying information on a daily basis about the amount of oil being pumped.
Not long after this column raised the issue of the lack of production information, one of the partners of Exxon, came forward and announced the average production. That is good enough. There needs to be real monitoring of oil production.
The technology exists and is not costly relative to the benefits. Real time monitoring of production is being done in Saudi Arabia. It can be done here. The President can sit at his desk at the Ministry of the Presidency and monitor on a television screen just what is taking place on the Floating Production Storage and Offloading vessel (FPSO).
Guyana was said to have high quality petroleum and it was said to have a low cost to pump. What this means is that the costs of production should not be high and the price, which the country’s oil will fetch should be premium.
In other words, we should be receiving above the world market price for the high-grade oil, which is being extracted from the Stabroek Block.
It has been more than one month since oil production began and up to now, we are not being told about the quality of the oil that was pumped. Guyana had to pass up the first three shipments because at the time production began, it had not yet negotiated the marketing of its oil, a most serious omission and one for which somebody should have provided answers.
Guyana is going to obtain an average of US$300M this year. Imagine what would happen if development costs are inflated. High development costs will eat into the extras, which Guyana is entitled under the worst oil deal ever signed.
But who exactly is monitoring these field developments costs? Do not tell me GRA. GRA’s work is not to regulate the oil industry on behalf of the government. GRA is not supposed to be a government auditor. It should not be involved at all in monitoring pre-contract costs for the government. It should only do any auditing of those costs if there are tax implications for the public.
GRA is a tax collection agency and profit oil is not taxes so its role is not to audit pre-contract costs. Exxon enjoys healthy tax concessions and therefore there is not going to be much taxes to collect.
So just who is monitoring the field development costs which will saddle the country with billions in cost recovery which has to be deducted before profit oil becomes available? Who is minding the store?
The Peeper has been trying to view the documentary Big Men, which was supposed to be available on YouTube. No sooner had Kaieteur News advised every Guyanese to look at the movie, that it has suddenly become unavailable on YouTube.
So who or what was responsible for its removal? And why would anyone want to deny people the right to watch that movie which we are told exposed some rather strange practices by top officials of oil multinationals?

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