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Jan 24, 2021 News
Kaieteur News- Trinidadian energy strategist, Anthony Paul, said that Guyana must take control of the spending it does on Floating, Production, Storage and Offloading (FPSO) vessels and other aspects of proposed field developments to ensure that the economics serve the people of Guyana well.
Paul, during a December 10 interview on Kaieteur Radio’s ‘Guyana’s Oil & You,’ told Senior Journalist, Kiana Wilburg, of how Ghana armed itself with officials who were technically capable of making the case, in one instance, that an additional FPSO proposed by oil companies, was not necessary.
“I was fortunate to actually be in Ghana working for the government, advising the regulator at the time.” Paul said. “We would sit down as a team, look at seismic data, and look at models. Look at well part choices and discuss among the technical team what the choices were.”
Paul reported observing a clear decision-making process about the need, or lack thereof, for the second FPSO.
“They had a very strong manager/CEO [Chief Executive Officer] who was very technical as well, and who could make the case to the Minister. The Minister had faith in his regulator and his people, to tell the companies ‘this is my decision’,” Paul said.
Explaining this situation further in a telephone interview with Kaieteur News, Paul said that in the Ghanaian oilfield of Jubilee, there was a partial development with an FPSO, which would deplete a part of the field. Approaching the time for the implementation of a second FPSO, Ghana’s regulator reviewed the plan and found that, as the well reserves had already been in decline, it would be better to use the existing FPSO alone to complete the production and preserve money.
The takeaway for Guyana, Paul explained, is that this country should have the capacity to review field development plans effectively, including the equipment, costs, reservoirs, production and have a holistic picture of the economics of each proposed operation.
“Managing your resource is very technical and you need strong capacity, people who understand those things to negotiate with the companies to approve field development plans,” he said.
The energy strategist noted that it is often forgotten that the Government, in these situations, is the boss – not the other way around.
“Agreements are contracts. The operator is a contractor working for the government.” He said. “The government is the boss. We tend to forget that.”
Paul is of the view that if the developments are left to the mercy of oil companies, a government runs the risk of results that are only in favour of the companies.
ExxonMobil sees potential for 10 FPSO vessels offshore Guyana, according to its Global Vice President of Deepwater Projects, Jayme Meier. Vice President, Dr. Bharrat Jagdeo, has said that he is in favour of aggressive and fast-paced depletion of Guyana’s reserves, as he believes that Guyana has a short window to capitalize on its oil riches before renewables take over.
JAGDEO ADDING MORE DANGER TO GUYANA AND THE REGION
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