Petroleum Commission not a safeguard against corruption

Apr 30, 2022 News

By Kiana Wilburg

Kaieteur News – Vice President, Dr. Bharrat Jagdeo acknowledged on Friday that an independent regulator for the oil and gas sector in the form of a Petroleum Commission is critical to any government’s regulatory architecture. At the same time, Dr. Jagdeo said the absence of such a body in Guyana does not mean that the sector is hanging from a dangerous precipice.
During an engagement with members of the media at the Office of the President, the local oil boss said one should not be hasty to assume that the establishment or presence of such a body would mean corruption is automatically prevented in the oil industry.

Vice President, Dr. Bharrat Jagdeo

Dr. Jagdeo said, “I can tell you of some countries with the worst corruption track record but they have petroleum regulators that are supposedly ‘independent.’ So a Petroleum Commission is not a safeguard against corruption. It is utter nonsense (to believe that it is).”
Dr. Jagdeo said a Petroleum Commission simply ensures that all payments for the sector are properly accounted for, that key financial documents are not hidden and licences that are awarded are made public.
The Vice President said this is already being done in a transparent manner by his government. He added that in the case of the Natural Resource Fund (NRF), the government has ensured by way of the law that all payments received by the fund are known to the country and the world by extension. Reports on these payments are published monthly on the Bank of Guyana website. The former President said the NRF law also stipulates that documents regarding expenditure are not to be kept within agencies as state secrets.
“We made a commitment that every agreement that the Petroleum Commission would have done in place of the Ministry of Natural Resources, all the licences would be out in the open. I told them that Liza One, Liza two, and Yellowtail Production licences must be out in the open. Also every environmental permit must be on the (Environmental Protection Agency’s ) website and people must be able to compare it to what was done under the APNU+AFC and see the qualitative difference,” the Vice President explained.
The Vice President said the government agrees that the Petroleum Commission is important while adding that it does have a role to play in the regulatory oversight that is needed for the sector. He noted, however, that the government wants to ensure the right model is in place as it is opposed to what was proposed by the former coalition via draft legislation for the Natural Resources Minister to be vested with absolute power over the Commission.
“We admit that there is a lot of work to do on the regulatory side…we are working on building capacity but we have challenges like any other place in the world,” the Vice President concluded on this matter.
Jagdeo’s comments come in wake of an article published by Kaieteur News about a week ago. The article notes that it has been seven years since Guyana is without an independent regulator for the sector.
Chartered Accountant and Attorney-at-Law, Christopher Ram, in a previous interview with this newspaper had hammered home the importance of this crucial regulator while bemoaning the seeming unwillingness of the current government to get the ball rolling on this matter. In a brief note to Kaieteur News, Ram had said, “The Government seems unwilling to set up an independent Petroleum Commission, and thereby remove the possibility of further secret deals and collusion between the politicians and the oil companies.
Ram had also expressed the firm conviction that this state of affairs, along with the absence of critical reports on ExxonMobil’s local content performance and its production offshore, do not augur well for transparency and accountability as promised by the Ali administration.