Latest update November 25th, 2024 1:00 AM
Jul 30, 2024 News
– while Jagdeo says Guyana has no say in award of contracts by ExxonM
Kaieteur News – The Government of Mozambique is demanding that oil companies operating there provide information on salaries paid to their employees as well as the contract sums for the provision of goods and services.
However, although Guyana is in a 50/50 profit sharing agreement with oil giant ExxonMobil, the country’s chief policy maker in the oil and gas sector Bharrat Jagdeo has said that the government has no say in Exxon’s award of contracts or the spending of the oil companies in the sector. He once directed a reporter to Exxon to have an explanation provided on its spending.
On Friday (last), 360mozambique.com reported that according to Lusa, the new regulations in place, applies mainly to the foreign concessionaries who have operations in the oil and gas sector in the African country. Mozambique has the third largest natural gas fields in Africa currently estimated at an astonishing 180 billion cubic feet.
The document seen by Lusa states, ‘The main aim is to ensure that citizens have access to employment opportunities, to promote the training of workers and companies through national and international co-operation and to ensure the participation of local suppliers in the contracting of goods and services.’
Additionally, the oil companies must submit the necessary documents to the National Petroleum Institute (INP) to prove the number of employees, a list of their names and must also specify data such as origin, gender and must include people with disabilities. Also included should be the salary scale and the respective allowances for the various positions of the employees.
With regard to the contracting of goods and services, companies will have to provide information on the nationality of the contracted companies, ensure compliance with the right of first refusal and submit documents proving the calls for tenders and offers from all participating suppliers.
“The main aim is to ensure that citizens have access to employment opportunities, to promote the training of workers and companies through national and international co-operation and to ensure the participation of local suppliers in the procurement of goods and services”
In regards to the work force’s composition, the law stipulates that the companies must ensure that the local workforce must comprise of at least 25% in senior positions and the other 85% must be in technical positions. If there are no locals qualified to do the work, then the companies will be allowed to hire foreigners once the company proves that recruiting local workers is impossible.
Furthermore, the law also requires concessionaires to provide training grants, which must include at least “1,200 hours of technical-vocational training and 600 hours of vocational training, as well as higher education opportunities. During the research and development and production periods, the companies must ensure that training scholarships are awarded at educational institutions in Mozambique and abroad, with the aim of training Mozambicans in various areas, including higher education, technical-vocational courses and vocational training.”
It has been reported before about the corrupt background of a number of companies with which ExxonMobil has handed contracts to provide goods and services to the sector. When the Vice President was asked by this publication to provide an explanation why the government was not preventing the award of contracts to these companies, he said that, “As I said before, there is no co-management.” He told the reporter from Kaieteur News that he should press Exxon on why the company chooses to conduct business with such companies.
Jagdeo was keen to note that if the foreign company meets the benchmark prices, then there would be no objection by the administration however, “if they as a result of any incestuous link between let’s say ExxonMobil and a firm from abroad, if that incestuous link would cause prices to go up and be unfairly added to our cost bank, it’s a big cause for concern for us and that’s why the auditors have to guard against that technically.”
Jagdeo pointed out that the provisions of the 2016 Production Sharing Agreement (PSA) allow the country to verify costs after they have been incurred by the operator of the Stabroek Block, through the audit process. “That’s the purpose of the audit so when they query it, they send it to Exxon now, Exxon has to explain how this screw was procured at this cost when the benchmark price, they cost everywhere else is $3,” the Vice President noted.
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