– Georgetown Chamber of Commerce
The Georgetown Chamber of Commerce and Industry (GCCI) still has many unanswered questions about the future of Guyana with oil as one of the main resources contributing to the country’s economy.
GCCI recently launched the eight edition of its yearly magazine—Business Journal. This year’s edition focused on “the promise of oil.”
Because of the theme of the Magazine, GCCI invited an executive of ExxonMobil to speak at the event as well as Minister of Natural Resources, Raphael Trotman. While ExxonMobil’s Operations Manager, Doug Mc Gehee attended the event; Minister Trotman was a no show.
However, GCCI was hoping to have the Minister shed light on many issues at the event.
During his speech, GCCI President, Deodat Indar said that the Chamber is committed to working with the Minister and the Ministry of Natural Resources. He said, however, that like any good partner, the chamber will constructively criticize when necessary for the good of the private sector and by extension the Guyanese workers. Indar commended Minister Trotman in his absence for his outreach with respect to consultation on the oil refinery prospects for Guyana, local content policy and the Petroleum Commission Bill.
He then expressed hope that Trotman can make a few things clear to the members of the Chamber who were present at that forum.
“Minister, in your delivery, I would like to first charge you to give this gathering of great minds here your thinking and intention on the local content policy that is currently in its draft stage, in terms of: the date we should expect an approved policy? And, what model was used as a framework to develop the current draft policy?”
With respect to the Petroleum Commission Bill that is before a parliamentary select Committee; Indar said that the GCCI is very interested in knowing, “What external model was considered in the drafting of the bill? And, was it Newfoundland, Norwegian, Australian, Alaskan?”
Also, Indar expressed hope that the Minister would explain the proposed Petroleum Commission Board and its makeup, independence, appointment, remuneration and removal of Board members.
Further, the GCCI president wanted to know how the bill meshes with good governance, transparency and being Bi-partisan.
“We see from many parts of the daily media and on social media that we have the potential to be a wealthy nation with flow of oil money. Guyana can witness an economic explosion with the Gross Domestic Product (GBP) growing between 400 to 2000% in the next two decades.”
He continued, “We also know as seasoned business people that basic management principles dictate a company with a diversified base of products and services are likely to be healthy and sustainable, these same principles apply to running a country.”
The businessman said that it is imperative that Guyana learns from the mistakes of others and recognizes that any country that has its economy dependent on one or two sectors will be doomed by it in the long term. He pointed to what is going on in Venezuela where 95.6 percent of its economy is dependent on oil which among other things has fractured its society. Indar said that a diversified economy will lead to a sustainable economy.
With that being said, Indar expressed hope that Trotman can shed light on government’s plan to ensure a diversified economy.
Indar said too that the GCCI hopes that the government is already working on strategies for the most effective use of oil revenues. He said, “We would like to see expenditure in the area of; education, healthcare, infrastructure such as bridges, roads, ports, ICT, quality infrastructure and programs for the alleviation of the poor.”
Finally, Indar turned his attention to the outstanding Sovereign Wealth Fund policy.
He noted that the Sovereign Wealth Fund is supposed to be a rainy day fund. He said however that the GCCI found that some countries use monies from their Sovereign Wealth Fund for current year running expenditure that are supposed to be funded from normal revenue cycles of government. Indar expressed his opinion that, “this is not what a SWF should be; I have just describe what would be tantamount to putting your money in a bag with holes if government is to take this approach. I warn against it.”
The President of the Chamber said that it would be welcomed if Trotman can give explanations on “What model was used to develop the framework for the SWF and when would we expect a first draft to be release so we can provide commentary?”
While all those answered requested by Indar remain outstanding, a few questions were answered by ExxonMobil’s Operations Manager, Dough Mc Gehee. He gave those who gathered a detailed run down on the operations. Mc Gehee noted that the overall estimation of oil already discovered in Guyana is now between 2.25 billion and 2.75 billion oil equivalent barrels. This, according to Mc Gehee, represents oil bearing rocks found in Liza one, two, three and four wells, Liza deep, Payara and Snoek. He reminded that oil was not found in commercial quantities at the Skipjack well.
Mc Gehee even joked that when Skipjack was found empty, they decided that the luck was with Liza so they named the others Liza three, Liza four and Liza deep.
The Operations Manager said that ExxonMobil is committed to exploiting the full potential of the Stabroek Block and “so we will keep drilling.”
He said that about 120 barrels of oil will be produced a day for the first 20 years in Guyana.
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