Guyana will not sacrifice rice, sugar for oil-President Ramotar
By Leonard Gildarie
As Guyana continues its off-shore search for oil in commercial quantities, President Donald Ramotar has warned that the country will not be sacrificing its other industries.
The Head of State also made it clear, yesterday, that his administration is not prepared to make the same mistakes as other oil-producing countries whose dependence on the proceeds has been known to create financial woes when the price drops.
Ramotar was speaking during the start of major course for government technicians in the oil and gas industry, at the Regency Hotel, Hadfield Street, just hours before the CGX Energy, which is drilling off Corentyne, Berbice, announced that it has not found oil in any commercial quantities. CGX also has 25 per cent stakes in the Jaguar 1 well being drilled offshore Georgetown. That drilling which started in February was expected to last 180 days.
The training of the 20-odd technicians is more than timely at this time, the President told the gathering that included several heads of government agencies and included representatives from the Guyana Geology and Mines Commission (GGMC), the Guyana Energy Authority (GEA), Guyana Oil Company (GuyOil), the Environmental Protection Agency (EPA) and the Ministry of Natural Resources and the Environment.
Acknowledging that mining remains one of the biggest industries of the world, the official said that Guyana will be moving to introduce similar courses.
But Guyana, while needing technicians, will also have to pay heed to the business side of the oil industry.
“…It is a huge business. We are at a disadvantage and advantage in this regards. Disadvantaged- because we don’t have a large body of skills at the moment, but advantaged too because we don’t have to start at the beginning and we do not have to make the same mistakes that other countries have made.
“We should try to learn and study the experiences of other oil-producing countries.” These, he noted, should include the best practices.
Admitting that the oil industry is a highly attractive one, President Ramotar stressed that it also comes with the negative sides. These include the “Dutch disease” where workers are lured to a field to the detriment of the other sectors.
“It can (also) push up the value of the dollar making it more expensive to export goods and services. The government, too, must learn how to deal with it. We have moved to broaden the base of economy and there was a time when the dependence was on sugar, rice and bauxite. We must do our best that we do not fall into that situation where we are totally dependent on oil.”
With oil prices, like any commodity, subject to rise and fall, Guyana must now more than ever guard against depending on the industry too much.
“Oil prices are now over US$120 per barrel, a far cry from 1992 when it was US$5 per barrel.
“…We have to avoid the economy going back to a narrow dependence on only one product. All of that tells a lot, a big challenge for all of us in our society because we would like to see every sector of our country develop.”
Ramotar insisted that his administration will continue placing emphasis on agriculture, processing and manufacturing. “And they should try to ensure that there is a good balance and good coordination between all of these sectors so that all can grow and not one at the expense of others.
“There must be development so that we can be at the centre and not at the periphery. In the final analysis, ordinary people must benefit.”
Interest in mining
The Head of State also disclosed that huge interest continues to be coming from the international community in the country’s mining sector with a number of agreements already concluded.
“Mining as a part of the GDP has been growing steadily over the years. Tremendous experience has been gained in a number of areas. Guyana has some experienced persons in bauxite and gold,” he said.
According to Ramotar, a US publication named Guyana as a country that will emerge as one of the major oil producing countries in the next 10 years. “Therefore, there is a lot of optimism that we will discover oil in our area and hopefully in the not too distant future. And I think that this event (training) is therefore long overdue.
“And I think we should have been preparing ourselves even before for the eventuality of us finding oil and to deal with that situation. Better late than never.”
Also addressing the gathering was Minister of Natural Resources and the Environment, Robert Persaud, who revealed that the training was initiated after Minexco Petroleum, during a meeting with the President had accepted a challenge to provide the course titled, “The five-day MBA in Oil & Gas”.
The training is being facilitated by Warren Business Consultants, a London-based management consulting and business training company providing strategic services to the energy industry, primarily in the oil and gas sector.
Minexco, he said, has done similar work in West Africa with countries there recently starting to produce oil in commercial quantities and the idea is to use the experience there to benefit Guyana. Several officials from Minexco, including its President, Efroyim Hecht, were also at the training.
Guyana is now moving to open its own mining school, set to be established in Linden, Region Ten, and will incorporate similar courses, the Minister said.
“The intention is for Guyana to develop local capacity, learn and create synergies with external knowledge and develop this type of relationship. At the end of the day, nurturing Guyanese to tap into the potential we know we have in the oil and gas sector.
“Training is just one component.”
Guyana has already started to engage a number of international entities and was last week presented with the first report of the Commonwealth Secretariat, at the behest of government, had examined the petroleum sector reform, including critical areas like legislations and regulations”.