Cronyism evolving in oil industry
Leader of the Opposition, Mr. Bharrat Jagdeo made some shocking disclosures in regards to the emerging oil and gas sector in Guyana. According to Mr. Jagdeo, family, relatives, friends and cronies of the APNU/ AFC Government have formed themselves into a syndicate and have been actively applying for petroleum exploration and production licenses for offshore mining blocks in the petroleum zone of Guyana.
The Opposition Leader stated, “It has been brought to our attention that a number of front companies with key APNU/AFC individuals and Ministers’ families as shareholders have submitted applications to the Ministry of Natural Resources for petroleum exploration and production licenses.” He further stated, “They are at least two companies that we (the PPP/C) know of that have developed complex shareholding structures that have made applications for these licenses for the off- shore blocks that are available now.”
He revealed that it is common knowledge that many foreign companies are also trying to acquire these blocks offshore. According to Mr. Jagdeo, in the past there was no interest in these blocks because oil was not found. However, with the discovery of oil the blocks are extremely valuable. He argued, “The moment you find oil there is a premium for owning offshore blocks. So a lot of these local companies have no means what so ever; who are aligned to Ministers and their families etc and some others, cronies; they have no means of finding hundreds of millions of US dollars to do exploration work. So, they will get these blocks and weeks later they will sell the blocks without any competitive process being followed, because now there is no competitive process for awarding the blocks. They will get them and then sell them. “
In light of the facts, Mr. Jagdeo has since called on the Government to auction the blocks as opposed to gifting them away in a non-transparent manner to family and friends. He posited that these blocks are a valuable resource to the country and if they are auctioned the country stands to make hundreds of millions of US dollars. He argued, “If President Granger is serious about transparency he should shut down this process. They should go to an auction; this is a valuable resource… because we are a country that has found oil. If you go to an auction, monies that the middle men would make would go to the state.”
The Leader of the Opposition also questioned why the Integrity Commission has not been functioning for almost years now. He stated, “… this is why the Integrity Commission is so important. We are going on to 3 years now for this Government and they have no submitted anything as yet to the Integrity Commission.” (Citizens Report)