Actions must judge Gov’t management of oil and gas industry – VP Jagdeo

When it comes to the management of Guyana’s oil and gas industry, it is essential to judge a government’s performance by its actions and policies, Vice President Dr Bharrat Jagdeo, lead in this sector, has emphasised.

Despite criticisms by several political commentators and local newspapers about the renegotiation of the 2016 Stabroek Block’s Production Sharing Agreement (PSA), Dr Jagdeo reminded that it was the previous government that signed the controversial agreement with ExxonMobil’s subsidiary.

Speaking at a press conference at the Office of the President last Thursday, the vice president said it was also the coalition who hid the agreement for years.

“Thirdly, they collected a signing bonus that they hid also. They did not deposit [the funds] in the consolidated fund – contrary to the Constitution of Guyana and the financial laws of our country,” the vice president reminded reporters.

When the deal was made public, the PPP/C was quick to voice its disappointment about this deal. However, according to Dr Jagdeo, the party recognised that renegotiating the contract would stall development programmes and deprive Guyanese of potential benefits.

And so, when the current administration assumed office, it was focused on ensuring that Guyanese reap greater benefits from the existing contract through several legislations and important projects.

One such project is the multi-billion gas-to-energy project being developed in Wales, Region Three, which guarantees cheaper energy costs, allowing citizens to save at least US$100 million in electricity costs. Cooking gas is also expected to become much cheaper once the plant is operationalised.

Additionally, the 2016 PSA was reformed by the administration, guaranteeing increased benefits for the Guyanese people. The new model PSA includes a 10 per cent royalty rate and a 65 per cent cost recovery ceiling. The profit share remains 50/50 between the government and the contractor, with a new corporate tax of 10 per cent.

More Guyanese are actively participating in the lucrative oil and gas industry, facilitated by the landmark Local Content Act enacted by the government. The act is currently undergoing review to address several loopholes that delinquent companies are taking advantage of.

The vice president also recalled that the coalition never engaged the press on matters concerning the petroleum industry, contrary to what is happening under the PPP/C Administration.

“We have to be judged by our actions. Look at our actions. Look at the PSA now, that’s the one. But we have sought to rectify what they did not do. We strengthen all of these systems. We answered questions on the oil and gas sector routinely, which they hid from,” Dr Jagdeo stressed.

Investors are flocking to Guyana, recognizing the government’s prudent management of the oil and gas industry which has created momentum in the country, not only in the petroleum industry but also in its traditional sectors.

“One truth exists. In fact, several truths exist that we are now in an enviable position compared to the rest of the world. The reason why you see investors flock in this country, unlike other countries, is because of the momentum here,” he underscored.