Local Guyanese owned entities should get preferences over others
-says co-accused wife had no knowledge of actions
This has relevance to your reports on local content (Feb 18) and GHK Lall commentary (Feb 17) as well as other commentaries. I applaud the government for consulting with the public in seeking to arrive at a policy on local content requirements (LCR) for the oil and gas industry. Local content policy refers to the legal requirement of foreign investors using domestic goods and resources or services for production. We have limitations in both.
When the APNU led regime was negotiating with Exxon in 2016/17 on a new oil production agreement for field development, a few of us, economists and budding oil enthusiasts, met in New York as well as online discussing royalty, profit sharing, and local content and offered recommendations. We also organized seminars, engaged in leafleting on the issue, and hosted oil specialists in several public forums in New York and zoom webinars. As expected, our recommendations were all ignored and Guyana signed a lopsided agreement with Exxon. The APNU led regime signed an oil agreement that was well below international norms. Since then, we have championed efforts to renegotiate the unjust contract without success.
The current President, Vice President, Minister of Energy and other spokespersons for this administration were quizzed by the media on renegotiation of the oil agreement. The government says it will not violate the sanctity of a contract but that it will press for greater local content in oil companies’ exploration and production; corporate and treaty lawyers defend the government. Exxon claims it has been spending billions on local content. Since there has not been any audit of Exxon’s expenditures or purchases or hiring, Exxon’s figures can’t be verified. It can’t be determined what percentage of Exxon’s expenses or personnel are actually ‘local’ content. A genuine audit may find just a small percentage of Exxon’s Guyana cost of operations is local content. The present administration has displayed seriousness about local content. Colleagues who met regularly over the last four years to discuss local content and other oil and gas related issues complain they were not invited for participation in the recent panel discussion.
All countries, including UK, Norway, etc., have a local content requirement in extraction of resources or foreign investment. There is a percentage of local resources used in foreign investment that varies as per negotiation. Generally, World
Bank and IMF recommends not less than 20% but can be up to 50%. Guyana gets the least amount of revenues for its oil. It is not known what percentage of local content is used in production or feeding of platform workers. Guyana does not have much technical skills or resources or capital equipment for oil or gas production. So its local content resources may be very infinitesimal. What qualifies (or not) as local content and how can it be enhanced? Local content is the value of local input that a project uses to help boost the national economy. It is not just the utilization of local food, but other resources as well including development (training) of local skills and technology transfer.
Local content is not the equivalent of hiring Guyanese for cleaning of the oil platform and rooms, cooking for platform staff, washing underwear and bed sheets, supplying bhajie and water melons, and non-technical activities. Local content is building a workforce that is skilled to meet the requirements of the energy industry. It is also hiring Guyanese in management. Those were some of our recommendations that were ignored by those who negotiated with Exxon. It is expected that Guyanese will be increasingly employed in the oil and gas sector and taking over the daily activities including technical aspects of the industry. Since Guyana lacks local manufacturing and oil specialists, it is expected that Exxon will provide training to Guyanese to enable them to take over operations of production. Where possible, Guyanese can be trained for the oil and gas industry by a local (not expatriate) contractor not just in Calgary or Texas.
Local content is also defined in terms of the ownership of the enterprise involved in production and training of Guyanese. Having a foreigner or an expatriate establishing operations in Guyana and virtually owning the newly found company that offer basic training to a few Guyanese for low paying oil sector jobs is not the meaning of local content. At any rate, the contractor reaps the bulk of the revenues with very little going to local Guyanese or those who champion local content policy. It is noted that during the previous regime, a few individuals took advantage of the secrecy of operations, the contract and of connections with the energy companies to establish companies that supply goods and services to them. Local Guyanese owned entities should get preference over others – that is the very definition of local content. Preference must not be given to those who enjoyed an advantage as a result of incestuous relationship with the oil companies or those with political connections getting contracts to recruit local Guyanese and providing training to work in the industry. There must be a level playing field for all with preference given to local Guyanese, especially those who champion local content policy. Local Guyanese and those who champion local content should enjoy the same tax breaks and duty concessions as the foreigners or expatriates.
The search for the boat containing bodies that was seen floating offshore Guyana on Monday will continue outside of the country’s Exclusive Economic Zone (EEZ), Minister of Public Works Juan Edghill says.
Contacted for an update yesterday afternoon, Edghill told Stabroek News that despite a number of searches local authorities were unable to locate the boat.
He explained that the last of the vessels which were out searching returned yesterday morning and reported that there was no sighting of the boat.
That vessel departed on Tuesday afternoon and had onboard members of the Guyana Defence Force (GDF) Coast Guard, Edghill said.
According to Edghill, local authorities are satisfied with the searches that were conducted in Guyana’s waters during which all the “possible” and “probable” areas were combed.
He said a number of international partners were contacted and asked to be on the lookout for the missing vessel in their waters.
Following the discovery of the vessel, an inter-agency task force comprising members of the Guyana Defence Force coast guard and the Maritime Administration Department (MARAD) was established to conduct investigations.
It was initially stated that efforts were being made to have the boat towed to shore.
However, Edghill, during an emergency press conference on Tuesday night had reported that the authorities had lost sight of the boat.
Edghill had said that it has been established that no Guyanese vessel or sea crew is missing. Surinamese counterparts were also contacted but there have been no reports of any missing crew or vessel.
With the unfavourable weather patterns at sea, Edghill noted that it is unclear what has happened. He pointed out that the boat could have sunk or drifted in another direction.
There are no visible markings indicating the origin of the boat.
Director of Safety at MARAD, Captain John Flores, had explained that from the pictures seen, it appears as if the boat with the bodies had been drifting for some time.
Meanwhile, the Ministry in a press statement on Wednesday said that officials in Guyana have contacted their counterpart in Trinidad and Tobago (T&T) to be on the lookout for the boat.
The statement had said that it is possible that the boat might have drifted towards T&T due to the direction of the ocean current.
According to the Ministry, the Maritime Administration Department (MARAD) has published a navigational warning through the US National Geospatial-Intelligence
Agency (NGA) requesting vessels to be vigilant for a boat adrift and to report same if there is any sighting.
Emails were also sent to several sister organisations seeking their assistance in identifying the boat and the remains of those on board, the statement noted.
The statement explained that the GDF have so far executed three reconnaissance flights over the initial probable area and the expanded search area but the boat was not seen.
“One vessel that was operating offshore was directed to the area of the boat’s estimated position on Monday night. It spent several hours on Tuesday searching the probable area of the boat’s track, but the effort was futile. This vessel has since returned to Port Georgetown, but its owner has several other vessels operating in the general area, and they have been advised to look out for the abandoned boat,” the statement explained.
Juan Edghill
“Two fast boats with two (2) – 200 HP engines each, left Morawhanna yesterday (Tuesday) morning with a team that included members of the Guyana Police Force and the Guyana Defence Force. They executed search patterns offshore and inshore, that encompassed the area from the Western Boundary of Guyana’s maritime border all the way to Anna Regina, Essequibo Coast,” it added.
A Linden labourer was yesterday sentenced to four years in jail and fined $1.7 million after he was charged with attempting to traffic cocaine in fudge.
Shaka Nunes, 36, of Maxwell Alley, Christianburg, Linden, was initially charged alongside his wife, Vanica Williams, of the same address, but the charge against her was withdrawn after he pleaded guilty and maintained that she had no knowledge of his actions.
The couple appeared before Chief Magistrate Ann McLennan in Georgetown, where the charge was read to them.
The charge against them stated that on February 15th, 2021, between Lot 31 Maxwell Alley, Christianburg, Linden, DHL Express at Lot 34 “B” Republic Avenue, Linden and DHL Express at Lot 50 “E” Fifth Street, Alberttown, Georgetown, they trafficked 3.692 kilogrammes of cocaine.
Nunes, a father of five, pleaded guilty to the offence and later informed the court that his wife had no knowledge of the offence. He asked for lenience as he noted that he did not wish to waste the court’s time.
Williams was subsequently freed of the charge.
The charge had its genesis in DHL in Georgetown receiving a suspicious package shipped from Linden, which prompted the company to contact the Customs Anti-Narcotic Unit (CANU).
An analysis subsequently confirmed that the fudge included in the box of local snacks tested positive for cocaine.
CANU ranks then visited the location of the mailing address in Linden, where they met Williams. She was questioned and told officers that it was her spouse, Nunes, who gave her the package to ship.
Nunes was contacted and he confessed, stating that the package belonged to him and Williams had no knowledge of it. Nonetheless, they were both held and charged.