Govt. yet to monitor independently and verify oil production

Aug 15, 2023 ExxonMobil, News, Oil & Gas

Four years later…

…K/News Publisher says Guyana could be losing thousands of barrels daily

Kaieteur News – As the Government of Guyana (GoG) concentrates on drafting a new Production Sharing Agreement (PSA) and the legislative framework to manage its blooming petroleum industry, Guyana could be losing hundreds of thousands of barrels of oil daily due to its failure to independently monitor and verify the production rates.

This is according to the Publisher of Kaieteur News, Mr. Glenn Lall. Since the country first discovered oil in 2015, Lall has been advocating for good governance of the industry. His efforts were intensified when the lopsided deal inked with oil major, ExxonMobil became public. The businessman has been protesting for changes to the contract to ensure a fair deal for Guyana.

In a recent public commentary, Lall intimated that four years after commencing oil production offshore, Guyana is yet to monitor the operations independently to verify the number of barrels being produced daily on the Floating Production Storage and Offloading (FPSO) vessels.

Presently, Exxon is producing oil from the Liza One and Liza Two projects in the 26,800 square kilometers Stabroek Block. A third offshore development, Payara is scheduled for startup later this year.

To this end, the newspaper Publisher reasoned, “If a man picking your mangoes to sell, you the owner does have to check how much he pick. A man picking you coconut, do you have to monitor him to see how much he pick? I am not sure.”

Guyana’s first FPSO, the Liza Destiny

Lall argued that foreigners in Guyana are exploiting the country’s timber, gold, bauxite, manganese, diamonds and now its oil. More importantly, he pointed out that the leaders have failed to put protective measures in place to verify production and export quantities.

The businessman said he was perturbed by the recent response given by Vice President Bharrat Jagdeo at his last press conference, regarding the monitoring of the oil sector.

Jagdeo said, “On issues relating to production verification, we said that Exxon is building an operational centre as part of the head office. They are gonna have a fiber optic cable coming in, we may have to get an access to the fibre or in the short term, we will probably use satellite technology to have an independent measuring of the flows and everything else.”

To this end, Lall lambasted the VP for aiming to “piggy back” on Exxon’s data to monitor the daily offshore production statistics.

In a subsequent comment to the newspaper, he explained that he does not believe the country lacks the expertise or human resource to monitor the production rates. He however pointed out that Guyana could be losing hundreds of thousands of barrels of oil daily, as it fails to verify the production.

“I don’t believe the figures being presented by Exxon. They are reporting 400,000 barrels per day but it is much more than that but like leaders don’t seem to give a damn about that. Guyana has become a free for all for Exxon and others and it is sad that this country does not know how much oil is being pumped or the interest rates we are paying or the equity charges coming out from our oil,” Lall noted.

He added, “Since when a country has to depend on the eyes of the watchman who is a known gangster to look out for the country’s interest? Guyana has spent US$1.6 billion of the oil money it received, on what, God in heaven knows. The most important thing, a cable from the meter out there to the Office of the President that will cost less than US$40 million hasn’t been put in place four years after pumping oil. What are we running? A country with its US-trillion-dollar resources or we running cake shop selling icicles?”

It was reported on Sunday that West Coast Gas Ghana just inked a joint venture agreement with e-Magic Inc, a local company that will allow the Government of Guyana to independently monitor the production of hydrocarbons from its oil and gas fields.

A statement to press by the two entities explained that the agreement will boost Guyana’s local content policy as it represents a competitive, combined force of proven expertise with local participation for the delivery of a cutting-edge technological solution.

It noted that the joint venture would enable the Government of Guyana (GoG) to have (i) direct and independent oversight within the natural resources sectors; and (ii) real time data enabling GoG to build its own review capability. See link for more details.

• barrels, losing, Monitor, oil, verify