Worrying trend as Guyana snuffs more help in building oil and gas capacity

Jul 16, 2022 News

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…wasted US$1M grant for EPA had catered for resource estimates- Former EPA boss

 By Zena Henry

 Kaieteur News – Former Head of the Environmental Protection Agency (EPA) Dr. Vincent Adams is adamant that Guyana has missed another meaningful opportunity to build capacity in its oil and gas industry, since like the still to be refined, World Bank US$20M loan, Guyana has failed to utilize another US$1M.

This time, an Environmental Protection Agency (EPA) grant that would have among other things, significantly contributed to the agency’s ability to monitor and access information arising for oil operations offshore.

As the Guyana government gears toward its inaugural bid round for petroleum blocks come September, this said information would have been extremely useful in the country understanding for itself what truly lies in its offshore oil banks, thus using the data to better the country’s bid position, Dr. Adams opined.

Minister of Natural Resources Vickram Bharrat told Kaieteur News on Monday, that ministry teams are still working on “refining” and bringing the US$20M loan facility on par with the current government’s priorities for the oil sector.

He suggested that, that work should be completed soon. The line of credit sought to strengthen various aspects of the oil industry, including support for cost oil audits and other fiscal areas, environmental monitoring and skills training for locals.

One Component of the World Bank ‘Guyana Petroleum Resources Governance and Management Project’ totaling some US$5.5M, would have seen agencies such as Guyana Geology and Mines Commission (GGMC) and the Department of Energy (DoE) among others, receiving “on-the-job training” training in reservoir engineering and geology.

This would have allowed for the State to be provided with independent third-party technical expertise needed to analyze estimates of oil and gas resources, assess and conduct economic and fiscal modeling to help forecast oil and gas revenues, and support the cost audit of existing Production Sharing Agreements, among other things.

According to Dr. Adams, the US$1M grant which he personally requested and secured from the local World Bank representative was meant to help Guyana in the same areas.  He explained to Kaieteur News, that during his tenure, he was able to connect with the World Bank representative and shed light on assistance needed to encourage the necessary capacity.

Dr. Adams said, a proposal was provided to the representative and after taking it to the Bank for approval, and US$1M was granted to Guyana with a significant portion of the sum going toward a Brazilian oil and gas expert conducting the training locally.

Key focus areas involved monitoring and accessing pertinent information needed for oversight purposes. This meant that representatives of the highly skilled 36-member Petroleum Unit, that was formed under that project would have had to provide “24/7” monitoring aboard the Floating Production Storage and Offloading (FPSO) vessels offshore, and Guyana would have been able to scrutinize for itself, all that is taking place offshore.

The country would have also had first hand access to the data being generated, reducing the country’s dependency on the oil companies to provide information on oil reserves and other technical information.

As such, now that Guyana is heading toward auctioning its available oil blocks, Dr. Adams said that by now, the Petroleum Unit would have been extremely useful because its experts would have been providing round the clock monitoring, and gathering information that Guyana could have used to put itself in a better bidding position.

“As long as the trained people are on board (the FPSO) we would get all the information. They (oil companies) cannot hide that from us,” the former EPA head said.

He explained that aboard the FPSOs, there is a control room where all the data comes and as long as the local teams are aware of what they are looking for, then the country would be receiving the same data as the oil companies.

Without this in place, the country is left to depend on the reports and data the oil companies provide.

Despite the proactive move to empower the EPA, Dr. Adams said, that after parting ways with the environmental agency, the program was scrapped.

Under his tenure, the EPA put in place opportunities for staffers to access higher education within the relevant petroleum fields from the University of Guyana or overseas institutions in return for at least five years of service.

Several staffers had already applied to universities when the project under the $1M grant was scrapped, and according to Dr. Adams, when employees asked about their status to seek higher learning, a very senior EPA Executive reportedly told them that “the EPA is not a university,” and that they were on their own in that regard.

Dr. Adams said, at the time of his tenure, he was the only petroleum engineering expert in the country with significant experience in reservoir engineering and was aware of the country’s deficiencies in the particular areas, and sought to change that by making the EPA a model agency “to set the tone” for the other energy related bodies.

“This is how it is done in the US; you have to have people out there. It’s the only way to know, you have to see the data for yourself,” Dr. Adams reiterated.

The fact that Guyana is yet to utilize the US$20M to build capacity, and has shunned the work done under the US$1M grant, “there seems to be a worrying trend,” he posited.

Dr. Adams has since challenged the EPA, to make public the report under the million dollar grant.

When contacted yesterday, EPA Executive Director, Kemraj Parsram, could not say whether a report was indeed available at the agency regarding the grant, and what it was supposed to achieve, but promised to make the necessary checks and provide the information. He told the newspaper that the program was “not during my time,” and that further, he is currently out of the country.

According to Dr. Adams, the EPA received the World Bank grant through the Department of Energy, and as such copies of that report, is with that agency, as well as the EPA.

 

 

 

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