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Govt. lost five years of oil and gas capacity building – Lars Mangal
The Government of Guyana has lost some five years of oil and gas institutional capacity building and the development of an agenda for the sector.
This is according to Guyanese oil and gas entrepreneur, Lars Mangal, President and CEO of TOTALTEC Oilfield Services Inc.
TOTALTEC’s President and CEO, Lars Mangal
He was speaking during an interview with German media outlet Deutsche Welle in late February 2020.
“The government of Guyana has lost five years in terms of institutional capacity building and development of an oil agenda to better serve the people of Guyana. This has to change as a matter of priority and with a sense of urgency,” Mangal said.
He said further that after the dust settles in Guyana following elections on March 2, 2020, the Government and the Opposition must agree to a binding long term agenda for the oil and gas sector, including a robust policy to ensure the utilization of local services and labour.
“Unfortunately, we lost a lot of time because our parliament was paralyzed for more than a year after a vote of no confidence in Dec 2018. In my opinion, what is important for development is a policy with a local focus, i.e. part of the materials and labour must be sourced and developed locally,” he said.
“After the next elections, politicians must overcome their divisions. The opposition and the government must agree on a binding long-term oil agenda. This is important so that the government sets the agenda in partnership with the oil companies,” he added.
Mangal noted that Guyana also needs to ensure good governance and accelerate marketing and exploration in other blocks where new contracting opportunities and models will emerge.
He said that from ExxonMobil’s Stabroek Block development, Guyana now has the opportunity to change as a country, to drive development, to modernize the economy and to lift every Guyanese household out of poverty.
“Exxon is one of the most capable oil companies in the world. We have a technologically complex offshore project here in Guyana that smaller companies couldn’t handle at the pace required. Given the depth of the field (1000-3000 metres), extracting oil in Guyana is like landing on the moon,” he said.
However, Mangal warned that because of the changes in global energy use, Guyana has a small window of opportunity to make the most of its oil extraction.
“The global economy is transitioning from fossil fuels to renewable sources of energy. Fossil fuels are also being used less in electricity generation. The window of opportunity for Guyana is closing fast and the country must act with a true sense of urgency,” said Mangal.
“The country has an unprecedented opportunity for a paradigm shift. But time is pressing. Our goal must be to produce 2 to 3 million barrels of oil a day as quickly as possible. Otherwise, there is a danger that we cannot benefit as a society from this resource.”
Commenting on what could possibly work as a model to ensure that Guyana’s oil revenues are well spent, Mangal suggested the creation of a household fund in which every Guyanese is a stakeholder.
“That fund should receive 60-70% of the oil revenues. Each citizen can draw a certain amount of funds for house building, education or health. That way everyone can decide for themselves whether they want to build a house, utilize private health insurance and or send their children to private schools. This stimulates the construction sector and positive, constructive competition between the state and the private sector. This would really be a step towards modernization and poverty reduction lifting every Guyanese household out of poverty within a decade,” said Mangal.
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