More than a week after receiving its production licence, paving the way for operations to begin in 2020, ExxonMobil has started advertising for key services that will pay billions of dollars annually. However, local businesses have
immediately expressed concerns, pointing out yesterday that the advertisement also targets member states of the Caribbean Community (CARICOM), some of which are in the oil business, placing Guyanese companies in an unfair position to compete
With Guyana receiving a two percent royalty and 50/50 deal on the profits, the actual jobs being created will not be in the thousands, officials have warned.
Rather, the spin-off services that ExxonMobil will demand once production gets underway will be where significant employment and investments can come. However, with neighbouring Suriname and especially Trinidad expressing deep interest, their oil experience has been worrying to local companies who want a foot in the door to benefit from the pie.
According to the advertisement, ExxonMobil’s local operations, Esso Exploration and Production Guyana Limited (EEPGL), is inviting companies to express interest in contracting opportunities.
“Companies must be registered in Guyana or other CARICOM countries and be registered in the supplier portal located on www.exxonmobil.com/guyanacontractors. Interested companies must notify EEPGL via e-mail as provided in the tender…”
ExxonMobil said that the companies must indicate their desire to participate, the contract title, company name, contact persons, phone and e-mail.
The oil company made it clear that the list of future contracts is tentative and not all inclusive. “The planned contracts and contract periods and opportunities are subject to changes at EEPGL’s sole discretion and without prior notice,” the advertisement said yesterday.
According to the Page Two advertisement of the US-owned ExxonMobil, they have already started the tendering process for helicopter services. These will include maintenance, ground services and other helicopter operations.
Also being advertised for are marine vessels which will provide support vessels for platform supply vessels, multi-purpose intervention vessels and tanker assist tugs.
A major service that Exxon’s offshore site will be sorely in need of is company experience in freight forwarding. This is to ensure a speedy packing, transport, clearance and expediting of materials to and from major international locations in Guyana and Trinidad.
Also needed are Close Container Units (CCU). These special containers have to meet certain standards and be colour-coded, and are a big cost for off-shore oil operations.
ExxonMobil said it is interested in renting or purchasing these offshore cargo baskets and containers. It is also seeking a supplier of riggings and slings to lift supplies onto the platform at the well site.
Except for the much-needed helicopter services, the oil company said it is targeting the second quarter to the third one for the tendering period.
Yesterday, a number of local businesses who have been expressing willingness to get involved, made it clear that members of the local private sector are not happy, and it is planned that the issue would be objected that the tendering is open to CARICOM countries at this stage.
“While ExxonMobil says it is committed to local content (Guyanese participation) in service and associated oil and gas activities, the company recently published on its website an invitation to local as well as CARICOM companies. Businesses have pointed out that given Trinidad and Tobago’s 100 years-plus experience with oil and gas development and services, Guyanese could not immediately compete with them.”
According to one businessman who insisted that his company is deeply concerned about what Guyana is really getting, “ExxonMobil is creating an uneven playing field for our companies.” “Local content means Guyanese, not the entire region. We need time to grow and garner experience. You can’t put us to compete with Trinidad or Suriname companies and say you are promoting local content.”
There has been agitation recently to push government to insist on more local companies’ involvement in the provision of services and other logistical support.
“Granted these are specialized services, but we do have access to expertise to help us to build capacity. Now is the time for this Coalition Government and ExxonMobil to get the situation right. That is all we asking for,” the businessman said.
Guyana is planning to build an onshore site in the Berbice River mouth area at Crab Island, to handle some of the logistical needs of ExxonMobil’s well site.
The company, one of the biggest in the world, discovered large deposits of oil about 100 miles offshore Guyana in May 2015. Since then, a number of other wells confirmed the find was significant.
Guyana recently issued the production licence and other permits, paving the way for ExxonMobil and its partners to commence full preparations for a 2020 start.
Since then, the US Company and its local operations have issued a number of contracts, for the floating platform and other services.
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