“Oil don’t ‘spoil!” So once declared Eric Williams, one-time long-standing Prime Minister of oil-rich Trinidad and Tobago. This assertion is undoubtedly true. But the distinguished scholar-statesman did not contemplate a circumstance where a dangerous mix of oil and water in the context of climate change dangers could spoil lives and livelihoods within the societies blessed with oil and gas resources. Such is the situation with the two nations in the Guyana-Suriname Basin (GSB). Technically, the GSB includes the coastal plains of French Guiana, Suriname, Guyana, and eastern Venezuela.[1] However, the focus here is on Guyana and Suriname, the Caribbean’s emerging petro-powers.
3rd Annual Guyana International Petroleum Business Summit & Exhibition – GIPEX 2022
May 10-12, 2022
GUYANA: ZOOM Event: The Oil Contract: a review
Moray House Trust – Thursday 12th May 2022
US Commerce Department South America Business Conference
Monday, May 16, 2022 – Sao Paulo Brazil
https://emenuapps.ita.doc.gov/ePublic/event/editWebReg.do?SmartCode=2QFM
Guyana Agri Expo – Department of Public Information
May 19-21, 2022
Guyana: the world’s fastest growing economy
MENAS London – Wednesday 25 May 2022
https://www.menas.co.uk/civicrm/event/info/?reset=1&id=90
Int’l Energy Expo 2023 launched with focus on traditional sectors – Guyana Times
CGX upbeat about oil potential in Corentyne Block: Kaieteur News
– as Kawa-1 well unlocks light crude
Canadian exploration partners, CGX Energy Inc. and Frontera Energy Corporation, were pleased to disclose on Monday that light oil is not only confined to the ExxonMobil-led Stabroek Block. According to the integrated results they received and examined for the Kawa-1 exploration well, light oil and gas condensate have been successfully unlocked in the Corentyne Block. Moves will be made later this year to see if a second well can find this resource in commercial quantities.
Wei-1 chance of success doubled after updated results from Kawa-1 – CGX, Frontera: OilNOW
CGX Energy’s discovery at the Kawa-1 well has ignited hopes of success in the Wei-1 well. CGX and its partner on the Corentyne Block, Frontera, said the detailed seismic and lithological analysis captured from the Kawa-1 find thus far hiked the chance of success at Wei-1 from 29% to 56%. The Wei-1 prospect is located approximately 14 kilometres (km) northwest of the Kawa-1 exploration well in the Corentyne block, 200 kilometres offshore from Georgetown, Guyana. According to Frontera’s Head of Exploration, Regan Palsgrove, the companies are confident about the Wei-1 well prospect.
Guyana makes first withdrawal from Natural Resources Fund – Demerara Waves Online News- Guyana
Indian refiners snapping up Liza crude, going after term deal with Brazil: OilNOW
Refiners in India, the third largest importer of oil in the world, are continuing to look towards Guyana and its neighbour Brazil to secure agreements for the supply of crude. Since last year, Indian refiners have been snapping up maiden import deals for newer crudes such as Guyana’s Liza and Brazil’s Tupi in a sign that the country is looking to diversify its feedstock basket and have steady supply sources beyond the Middle East, S&P Global Platts said in an article. Stabroek Block crude gives Guyana strategic advantage over global peers, says energy expert.
Primary stakeholders remain in the dark on Wales gas project: Kaieteur News
ExxonMobil is pressing ahead with its planned stakeholder consultations in the various administrative regions that are likely to be impacted by the Wales Gas-to-Energy project on the West Bank of Demerara, but in doing so, the oil company has no plan to meet directly with the residents of Crane and the Canal Polders – those who are likely to be most affected. In its Environmental Impact Statement (EIS), Exxon’s consultant, the Environmental Resources Management (ERM), noted that robust public consultations were done for the developer to not only gather information to inform the study, but also to understand stakeholder concerns.
EITI – Guyana must do better: Kaieteur News (Editorial)
The Board of the Extractive Industries Transparency Initiative (EITI) has made its position clear: Guyana must improve (“Govt. urged to do more to educate citizens on resource governance…EITI Secretariat told to demand higher standards of transparency and accountability from Government” -KN May 5). Those are steep issues in a steeper environment, which lead to an outlook that is far from encouraging. We have a PPP/C Government whose leaders say that they are about transparency and accountability, but that is all that they do.
Guyana signs air services agreement with world’s largest oil producer: OilNOW
Aiming to be a major transport hub in the Latin America and Caribbean (LAC) region, Guyana has entered into an Air Services Agreement with the world’s largest oil producer, the Kingdom of Saudi Arabia. Guyana’s Minister of Public Works, Bishop Juan Edghill, signed the pact in the Saudi capital Riyadh with his counterpart, Saleh bin Nasser Al-Jasser, the Kingdom’s Minister of Transport and Logistic Services.
Brazil, Guyana exploring Boa Vista-Georgetown Road corridor to boost trade, investment: OilNOW
to meet with President Dr. Mohamed Irfaan Ali last Friday, the two agreed to explore the merits of a road corridor linking Boa Vista, the capital of the Brazilian State of Roraima, and Georgetown, Guyana’s capital. They are looking to determine the impact such infrastructure would have on trade and investment between the two countries, as well as for the wider region. A working group will be established and ordered to produce an assessment of the potential gains of such a corridor in terms of trade and investment, as well as identifying possible needs of technical assistance, potential private partners, and international financial institutions to contribute to the initiative.
Brazil’s position on territorial sovereignty key for Guyana – Demerara Waves Online News- Guyana
3rd Annual Guyana International Petroleum Business Summit & Exhibition – GIPEX 2022
May 10-12, 2022
US Commerce Department South America Business Conference
Monday, May 16, 2022 – Sao Paulo Brazil
https://emenuapps.ita.doc.gov/ePublic/event/editWebReg.do?SmartCode=2QFM
Guyana Agri Expo – Department of Public Information
May 19-21, 2022
Guyana: the world’s fastest growing economy
MENAS London – Wednesday 25 May 2022
https://www.menas.co.uk/civicrm/event/info/?reset=1&id=90
Int’l Energy Expo 2023 launched with focus on traditional sectors – Guyana Times
Oil revenue spending on social and economic transformation has started: Kaieteur News (Columnist) Consumer Concerns by Pat Dial
– Political Opposition, concerned NGOs and public have heavy responsibility of monitoring, analysing for transparency
It has often been said that the discovery of oil in any country brings with it both blessings and curses. One such curse which has descended upon Guyana is the plethora of advice and fearsome threats from both local and foreign sources foretelling of the frightening dangers which lie in wait to envelop the country.
Yellowtail Production Licence reveals… ExxonMobil must conduct study of gas in all Stabroek Block projects, discoveries: Kaieteur News
According to the Petroleum Production Licence (PPL) for the US$10B Yellowtail Project, ExxonMobil’s affiliate, Esso Exploration and Production Guyana Limited (EEPGL) will be required to conduct a Gas Utilisation Study to examine the associated gas and non-associated gas available from all approved oil projects and discoveries in the Stabroek Block. It therefore means that the government is seeking to ascertain how much gas is in the Liza Phase One, Liza Phase Two, Payara and the Yellowtail Projects. The administration also wants Exxon’s help in understanding the oil to gas ratio of all its discoveries in the Stabroek Block.
Guyana holds over 10% of all conventional resource finds since 2015: OilNOW
Guyana has made its mark in the global oil and gas industry with an estimated proven recoverable resource of nearly 11 billion oil-equivalent barrels in the ExxonMobil-operated Stabroek Block. “That figure accounts for more than 10% of all the conventional resource finds in the world since 2015 when Guyana first discovered oil,” said Liam Mallon, ExxonMobil’s President of Upstream Oil and Gas. The company’s three latest discoveries at the Barreleye-1, Patwa-1, and Lukanani-1 wells led to the increased resource estimate – a figure that had previously stood over 10 billion oil-equivalent barrels.
Exxon pledges strictest adherence to int’l standards on flaring, produced water treatment for Uaru Project: OilNOW
ExxonMobil affiliate, Esso Exploration and Production Guyana Limited (EEPGL) has assured authorities in Guyana that its proposed development at Uaru will abide by the strictest international standards and best practices for gas flaring and produced water. Application process for Exxon’s fifth Stabroek Block development underway. In its project summary, EEPGL said Uaru will be designed for no routine flaring of associated gas. The gas will be used for fuel or will be reinjected into the reservoirs to improve oil recovery. EEPGL said this design is consistent with ExxonMobil’s plans to align with the World Bank’s initiative to eliminate routine flaring by 2030.
Yellowtail Development: Exxon to provide gov’t with list of training opportunities for Guyanese: OilNOW
The Petroleum Production Licence (PPL) for the US$10B Yellowtail Project stipulates that ExxonMobil’s affiliate, Esso Exploration and Production Guyana Limited (EEPGL), must provide the government with a list of potential opportunities for local and overseas training or secondee positions within its organisations or affiliated companies, together with estimated costs. EEPGL is required to provide this information to the State within six months of the date it received the Yellowtail PPL (April 1, 2022). It must also update this list each calendar year.
Guyana must improve citizens’ spending and productive abilities for real oil development: Kaieteur News
Apart from the strides being made by government in updating laws, improving planning systems and strengthening oversight, Guyana must proactively increase the productivity of its people, and encourage improved incomes to ensure true economic transformation from its newfound oil wealth. This is the advice of Dr. Zainab Usman who believes that primary focus should be placed on human capital development as a means of ensuring the successful economic development of the country through its oil endowments. Usman, a Senior Fellow and Director of the Africa Programme at the Carnegie Endowment for International Peace in Washington, D.C., is another international expert lending a voice to positively guide Guyana within its oil and gas fortunes.
Exxon ignores calls to halt gas-to-shore consultations: Kaieteur News
– says engagements will proceed as planned
United States oil major, ExxonMobil has said it will be proceeding with its planned consultations on the Wales Gas to Energy pipeline project, even though one Attorney and activist has called for the sessions to be postponed until after the 60 days public review period has ended. The activist, Ms. Elizabeth Hughes on Thursday penned a letter to the Exxonmobil Guyana President, Alistair Routledge as well as the Head of the Environmental Protection Agency (EPA) where she argued that the consultations are nothing but a distraction.
LCDS will help Guyana avoid perils of fossil fuel trap – environmental scientist: Kaieteur News
With the emergence of the oil and gas sector, Senior Director for Climate and REDD+ at the Ministry of Natural Resources, Pradeepa Bholanath asserts that the government’s Low Carbon Development Strategy (LCDS) 2030 is more important now than ever. During an interview on Kaieteur Radio’s Programme, Guyana’s Oil and You, Bholanath explained that back in 2010, stakeholders had conducted various debates about balancing the competing objectives associated with economic development and the environmental impacts.
Exxon’s recovery of US$1.3B plus investment in Wales gas-to-power project violates int’l best practices – Industry Expert: Kaieteur News
Vice President, Dr. Bharrat Jagdeo has said that ExxonMobil Guyana will be able to recover its US$1.3B plus investment in the imminent gas-to-power project from Cost Oil; in other words, Exxon would be recouping its investment in the gas project from the country’s oil earnings. Industry stakeholders are however concerned about this arrangement and worry that the government has not thought through the economic impacts. Specifically, one industry expert told Kaieteur News that the arrangement leaves Guyana with an even smaller piece of the pie since cost oil should only be associated with expenses incurred for the extraction, development, production and sale of the oil in a specific oil field.
Guyana’s leadership wants Guyanese and its members in the diaspora to play more significant roles in the country’s developing oil and gas economy as its key players work on advancing the industry forward.
Guyana’s Foreign Secretary, Robert Persaud, emphasized this commitment during conversations with members of the diaspora at a seminar titled “Opportunities for the Diaspora in Guyana’s New Economy,” hosted by the Natural Resources Ministry in collaboration with the Ministry of Foreign Affairs and International Cooperation. The event was conducted at the Hermandston Lodge in Georgetown and virtually.
Speaking at the event, Guyana’s Foreign Secretary, Robert Persaud, stressed the need for more participation and Guyanese to take up leadership positions within the industry. He pointed out that the government is working to ensure that they can play more key, significant roles. According to a rough estimate, Persaud said Guyana might need approximately another 100,000 skilled workers over the next decade as the Oil economy develops. He said there is a need for more Guyanese to be owners and operators related to companies and services, citing the country’s approach to keeping the diaspora more meaningfully engaged and informed. Additionally, he stressed the need for these Guyanese to work in synergy with international players and other countries within the Region and beyond.
“In so doing, we’ve also looked at how it is that we can tap the resources of the diaspora…these Guyanese, they possess, one- skills that are badly needed in Guyana; two- capital; three- a lot of experience; four, and very importantly- the networking in terms of their connections…their ability to engage multi-national large companies that have reach in many parts of the world. And we take it as a priority to see how we can mobilize and reach out and facilitate the diaspora working very closely with Guyanese living here, too…we see the diaspora as augmenting, enriching and being able to bring additional value in some areas- to those persons, businesses, individuals and their activities here in Guyana”, Persaud said.
Foreign Secretary Persaud said the government takes seriously its obligation to provide opportunities for Guyanese, both local and in the diaspora. He said it had developed several incentive programs and platforms, including a Diaspora Unit with the Foreign Affairs Ministry. Persaud added that Guyana’s Missions, Consulates, and Embassies aim to provide and facilitate linkages between recruitment companies and other relevant government agencies to create solid partnerships and synergies.
Director of the Local Content Secretariat, Martin Pertab, who also spoke at the event, said more emphasis is being placed on the developmental skills of Guyanese to secure leadership positions. “We have tons of local providers interested in providing the services, but they don’t have the kind of standard that these companies will deem them eligible for them to participate. So, we have said to them that, ‘you have to provide training to our locals to ensure that you will consider them eligible so they can participate in the procurement process”, he outlined.
Director Pertab also noted that this is part of the Secretariat’s objective to boost local participation. He pointed out that sub-contractors are encouraged to provide local content plans to the Secretariat for projects they are interested in. He pointed to the open-door policy of the Secretariat, noting that the portal has been updated to facilitate application processes. Presentations were also made of recruitment companies that interacted on their activities in procuring and securing skills within the diaspora. These included Excel Guyana Inc., Guyana Logistics and Support Services, Pandora Energy Inc., and Western Logistics Guyana.
Paul Cheong, the Private Sector Commission chairman, also spoke at the event. During the interactive Question and Answer segment, a participant pointed to numerous challenges in getting organized when doing business in Guyana, notably with the banking system. The participant challenged the government to make things “a bit easier” for persons coming back to do business. Director Pertab assured the participants that the government would soon resolve these issues as mechanisms to better facilitate business conduct within the country emerged. One notes that streamlining the regulatory and permitting system has been slow. Coupled with the high cost of stable and reliable energy, this state of affairs continues to retard diaspora engagement growth. In this context, it is hoped that the impending gas to power project will address some of these challenges.
Guyanese scholar Dr. Lear Matthews has noted that realizing diaspora engagement has seemingly become an impossible task for successive Guyanese Government administrations. The process has often been tarnished by transnational tensions and ethnic and political nuances. He observes that a failed history of diaspora engagement cannot be denied, evidenced by the frustration, skepticism, and disappointment among Guyanese in the diaspora due to well-intended but poorly executed diaspora engagement efforts.
Guyana’s leadership must be mindful of this context if it expects to succeed in having the Guyanese diaspora play more significant roles in the country’s developing oil and gas economy. The conclusions of a recent in-depth study of the Guyanese diaspora, which closely focused on the diaspora’s overall character, size, and skills and the degree of engagement between the diaspora and the public and private sectors in Guyana, by the Center for Strategic and International Studies(CSIS) can offer us some guidance. Coming out of these interviews and research work, CSIS developed specific recommendations to promote and encourage a deeper and more mutually beneficial relationship between Guyana and its diaspora. The Report recommended the development of a skills, talent, and expertise database to facilitate an online and direct exchange of expertise among Guyanese individuals wherever they might live in the world and a complementary database of the multiple diaspora organizations and institutions across the globe.
And in addition, a database of opportunities and projects in Guyana within the public, private, and civil society sectors to be targeted by Guyanese and non-Guyanese to attract greater human, social, and financial capital to Guyana its development efforts. Finally, the Report also identified priority issues to engage the diaspora in Guyana’s economic future. Below are six of these priority issues for diaspora engagement that can and should be advanced today.
- Promote an advanced, cutting-edge health sector with a critical focus on primary care.
- Promote a world-class twenty-first-century education system at all levels, focusing on broad coverage of the entire country and with strong links to the best institutions of higher learning globally.
- Promote practical approaches to address critical environmental issues, including Guyana’s low coastal plain (9,000 square kilometers of Guyanese territory is below sea level and in almost constant threat of flooding).
- Explore ways to empower young people, especially marginalized youth, to play a more active role in contributing to and benefitting from national development, including engaging younger generations in the diaspora through effective use of technology and social media and innovative media approaches to mentoring.
- Promote entrepreneurship and investment, including by diaspora members, in information and communications technology (ICT) and other sectors.
- Promote efficiency and transparency of government operations, including e-government initiatives that are not yet well-established in Guyana.
The government’s Diaspora engagement efforts will be immensely strengthened by identifying and adopting a coherent framework, like the one described above, within which Guyanese can rigorously and systematically address the issue of Diaspora engagement.
Dr. Terrence Richard Blackman, associate professor of mathematics and a founding member of the Undergraduate Program in Mathematics at Medgar Evers College, is a member of the Guyanese diaspora. He is a former Dr. Martin Luther King Jr. Visiting Professor at MIT and Visitor to The School of Mathematics at The Institute for Advanced Study. Dr. Blackman has previously served as Chair of the Mathematics Department and Dean of the School of Science Health and Technology at Medgar Evers College, where he has worked for almost thirty years. He’s a graduate of Queen’s College, Guyana, Brooklyn College, CUNY, and the City University of New York Graduate School. He is the Founder of the Guyana Business Journal & Magazine.
Utamu Belle is an award- winning Guyanese journalist with a career spanning over a decade. Her experience includes writing for print, television and online media. She has worked as a Radio and Television host. She is the Founder of A-to-Z Media (Guyana) and a News and Digital Editor with Upscale Magazine.
By Dr. Arlington Chesney
Recently, there have been a number of political pronouncements on the urgent need to reduce the regional Food Import Bill.
In 2019, Barbados’ Prime Minister, Mia Mottley, directly linked the revival of the Caricom Single Market and Economy (CSME) to a reduction in regional food imports. In 2020, Caricom Heads approved the Proposal of its Associate, the Caricom Private Sector Organisation (CPSO), to reduce food imports 25% by 2025.
Guyana’s President, Irfaan Ali, at Heads’ Meetings in 2021 and 2022, enthusiastically supported the reduction of the Food Import Bill and the 25×2025 Proposal. He proposed specific initiatives like the Caricom Sustainable Agriculture Facility (CSAF).
In 2022, St Vincent and the Grenadines, Agriculture Minister, Saboto Cesar Jnr, adopted the 25×2025 proposal.
There were previous Expressions of Intent aimed at reducing food imports. The most renowned of these was in 2004, when three senior regional professionals (including the author) supported then Guyana President, Bharrat Jagdeo, to prepare the Grand Anse “Framework for the repositioning of Caribbean agriculture.” In 2005, it was approved by Heads as the Jagdeo Initiative (JI).
The import bill in 2005 was US$1.64 billion. It now approximates US$3.8 billion.
What went wrong? The failure to implement the decisions of Heads. Some major causes (mostly identified as Key Binding Constraints in the JI) of this crippling Implementation Deficit follow.
First, from the 1970s to now, vacillating focus for the development of regional agriculture between reduction of imports and foreign exchange earnings reacting to global influences, such as the financial meltdown and the Ukraine imbroglio.
Second, inconsistent messaging by Heads on the importance of agriculture. Changing from being a “stand alone item” to being subsumed in “economic development” on agendas of their meetings.
Third, inadequate or inappropriate transmission of regional decisions to member states resulting in some key issues being unknown and/or misunderstood within National implementing ministries.
Fourth, limited appreciation that agriculture development is the responsibility of the Ministry of Agriculture and others. For example, major agricultural thrusts need significant numbers of personnel trained at all levels. Similarly, legal affairs must understand the intricacies of and urgency for new/modified legislation.
Fifth, unrealistic responsibility placed on micro, small and medium enterprises (MSMEs) to achieve the increased production required to substantially reduce food imports. There was also limited involvement of the larger businesses: importers, distributors and wholesalers, etc. of food. The resulting minimal interaction led to mistrust. The poultry industry was/is a good example of this phenomenon.
CPSO can reduce this mistrust by promoting inclusivity and, as needed, mentoring.
Sixth, poor integration or coordination of the work programmes of agencies, such as Caribbean Community Climate Change Centre, Caribbean Agricultural Health and Food Safety Agency, Caribbean Agricultural Research and Development Institute (CARDI), Food and Agricultural Organisation and InterAmerican Institute for Cooperation in Agriculture, involved in agricultural development in the region.
Seventh, unavailability of an “On Line, Real Time” regional Information and Intelligence System to maximise intra-regional trade.
Eighth, inadequate intra-regional transport. It can be easier and cheaper to ship commodities to Miami than within the region.
Ninth, limited access to commercially available finance because of an inadequacy of “bankable projects.” Interestingly, CPSO has initiated preparation of Business Investment Cases. MSMEs don’t have such capacity.
The CSAF, through Republic Bank, adds US$100 million as a special credit facility “designed for agricultural activities, including development of priority crops and capital equipment for farming, feeder roads, bulk storage, processing plants and shade houses” with a reported 5-year repayment period and 2.5% annual interest. Notwithstanding, these funds appear best used by Governments to provide critical infrastructure, including feeder roads and customised seaports to facilitate bulk transport of grain regionally.
Additionally, two issues remain as major causes directly reducing on farm production and intra-regional trade:
- Praedial Larceny: estimated in 2010 to cause direct losses of US$321 million annually and described as “the most discouraging aspect of agriculture.”
- NonTariff Barriers to Trade: theoretically for protection against pests but in practice more related to fear of intra-regional competition with resulting pressure on the political system. Enforceable Pest Risk Analyses must be conducted.
There exists a global food shortage which can worsen as, additionally, some countries are stockpiling for their own use. Further, a recently published survey, commissioned by Caricom Secretariat and World Food Programme, has estimated severe food insecurity in the Caribbean to have increased by 72% since the onset of COVID-19.
The region’s food and nutrition availability is seriously threatened. Prime Minister Mottley and President Ali must ensure realisation of then Lead Head Jagdeo’s 2011 pronouncements that the region must be more proactive than reactive; be more cohesive and coordinated; and show unwavering political will and bold action.
The region must produce substantial amounts of its food. The role of Guyana and Suriname, the region’s latest oil and gas beneficiaries, is paramount. Along with Belize, they are the only ones with land masses (but relatively small populations) for sustainable production of corn, soya, beef and vegetable oils: major imports.
Similar developing countries have suffered from the “resource curse” with weakened non-oil sectors, including agriculture, experiencing reduced competitiveness for human and financial capital.
The responsibility for expanding the Guyanese and Surinamese agricultural sectors for a sustainable post oil and gas economy resides with both the Governments and the involved private sector.
Companies, such as, SBM, Exxon, CGX, Schlumberger and Halliburton, through strategically aligned Corporate Social Responsibility programmes, will directly impact reducing regional food imports as they support Guyanese and Surinamese agriculture through programs to support indigenous agriculture and rural business development. The announcement that a large and modern port facility will soon be under construction in Guyana at Vreed-en-Hoop to help support the oil industry is a promising step towards making it easier to export Guyanese agricultural products in bulk, but additional government investment in facilities specific to agriculture will be crucial.
Some suggestions to address major challenges to reducing food imports, which can contribute in the short to medium term, to the sustainability of commercial initiatives identified at the Agri-Investment Forum and Expo, Guyana, May 19-21, follow.
First, the region’s objective must be food sovereignty: its collective ability to produce the majority of its nutrient requirements for its resident (18+ million) and tourist (32+ million annually) population. Production and marketing (quality, safety and reliability) standards (similar to those for exports) must be maintained.
Second, consistently unanimous messaging by Heads placing agriculture on the “front burner” and tangibly supporting the 25×2025 proposal on every occasion, including through the strategic allocation of oil revenues to worthwhile development projects, in Guyana’s case.
Third, policy and decision makers recognising that agricultural development is the responsibility of the “entire society.” Hence, when Heads appoint Agricultural Ministerial Task Forces, complementary subject Task Forces must be identified to participate in linked decisions.
Fourth, establishment of national agricultural liaisons within the Office of Presidents/Prime Ministers to explain regional decisions, monitor and report on their implementation. Meaningful and timely adjustments can be made.
Fifth, synchronisation of work programmes of major institutions supporting regional agricultural development.
Sixth, coordination of timely, result oriented research for development so as to facilitate the enhanced productivity throughout the value chains. This is a role for CARDI, the region’s only owned R&D entity. However, it must be adequately resourced; must improve its efficiency; and expand its role to include coordination of activities within the region throughout the value chain by means of a Consortium; and intra-regional dissemination of relevant global results.
Seventh, the development of capacity (a) to prepare bankable projects, including derisking options, particularly for MSMEs and indigenous peoples, (b) for CAHFSA to rapidly conduct agreed and enforceable Pest Risk Analyses, (c) to establish a Regional Information and Intelligence System, and (d) to prepare an action plan to address critical issues within the CSME, such as, movement of capital, and contingency rights, which are critical for successful cross border agricultural investment.
Eighth, Presidents Ali and Santokhi of Guyana and Suriname, respectively, to invite their major oil and gas companies to, in a coherent fashion, support minimisation of the chances of their countries suffering from the “resource curse” by aiding, wheverever possible, in initiatives to build other sectors and foster entrepreneurship.
This self-sustaining financial support should be used for critical developmental (not for profit) activities, as exemplified in the two previous paragraphs. It could be in the form of (i) a Trust Fund (as was the case of the Caribbean Court of Justice) and (ii) reducing annual subventions. It could possibly be managed by either the Caribbean Development Bank or the CCS.
President Ali and Prime Minister Mottley, supported by the CCS and involving the peoples, must lead this urgent “business unusual,” “all of society” approach if they wish to achieve their goals of the 25×2025 proposal and a vibrant CSME.
Dr. H. Arlington D. Chesney is a leading Caribbean Agricultural professional who has served his country, the Caribbean and the Hemisphere. He is a Professional Emeritus of IICA and, in 2011, was awarded Guyana’s Golden Arrow of Achievement for his contribution to agricultural development in Guyana and the Caribbean.
President Irfaan Ali, Caribbean Leadership in a time of Crisis and Opportunity
By
Dr. Terrence Blackman & David Roberts
The war in Russia and the attendant geopolitical energy issues plaguing Europe and the rest of the world bear directly on the energy and food security of the Caribbean and Latin America. Against this backdrop of global anxiety, the President of the Cooperative Republic of Guyana, the world’s newest petroleum powerhouse, His Excellency Mohamed Irfaan Ali, delivered the keynote address for the Guyana Investment Seminar at the prestigious Carlton House. The Caribbean Council, a well-established investment and trade membership organization, committed to supporting sustainable and responsible private-sector-driven development and investment in Cuba, the Caribbean, and Central America, organized the event. President Ali shared his government’s vision for managing the world’s fastest-growing economy. In addition, he outlined human resources and infrastructural developments his government is making to attract Foreign Direct Investment (FDI).
President Ali centered his presentation around the question: “How do we transform the country, protect the environment and ensure a positive transformation in the lives of the Guyanese people?” He defined his government’s “People’s Transformation” as a plan “to seek prosperity for every Guyanese, to ensure that every Guyanese citizen has access to the best housing, health, and education services. A plan to see the next generation of Guyanese growing up wanting to be part of the country’s development. A plan to see women and youth integrally engaged in the country’s development trajectory, to see women, youth and students playing a key role in formulating policies and programs that will affect their future and their lives.”
In addressing the unexpected, increased interest in the other traditional sectors since the discovery of Oil & Gas in Guyana, President Ali identified possible previous barriers to interest: the government’s inefficient bureaucracy, an ailing and, at times, dysfunctional democratic system; and Guyana’s relatively small population size; none of which seem to matter now that the oil and gas exploration in Guyana’s waters has proven successful.
President Ali is betting on Guyana’s natural resource bounty to support his government’s economic development plan for transforming the country and people. He highlighted Guyana’s minuscule deforestation rate and its competitive advantage in agriculture over the other countries in South America. In addition, President Ali noted that Guyana is the country in the region with the most significant likelihood of becoming the breadbasket of the Caribbean. Finally, the President pointed the audience to a strategic joint venture with Barbados on food production.
President Ali assured the gathering that he and his team are mindful of the ever-present challenges of avoiding the many obvious pitfalls on the development journey. He reiterated that his government is steadfast in its resolve to beat the odds, including the adverse effects of the Russian-Ukraine war on commodity prices: a war he categorically stated he and his government are against.
President Ali also noted for the gathering that despite Guyana’s abundance of environmental and natural resources, it has the highest energy cost in the region. His government, he said, is committed to reducing electricity costs by 50% by 2025, in part through a major new gas-to-power plant.
President Ali said that his government is bringing in natural gas, setting up a hydroelectric project, and adding off-grid solar systems to hinterland communities to allow citizens access to resources that will help them improve their lives.
He also noted his government’s exploring a regional energy policy that would include Northern Brazil, Suriname, and French Guyana. This unique initiative, which could lead to Guyana combining its energy resources with those of Suriname, could potentially give rise to a new energy hub with a real possibility of supplying Northern Brazil. Essentially this energy policy would be premised on regional energy demand and facilitated by advancing the connectivity between Guyana and Brazil through the new Guyana / Brazil highway recently commissioned and underwritten by Caribbean Development Bank. The United Kingdom notionally earmarked seven hundred and fifty million pounds to the venture.
President Ali referred to the difference in attitude by certain suitors keen on mutually beneficial relationships with Guyana and commented that “aggression” was the clincher. However, Chinese “aggression” is waning as the global interest in Guyana, post the Oil & Gas phenomenon, has increased. To some degree, more substantial offers are being suggested from the UK and European Union, and the United States of America. The President shared confirmation of financing of a new Children and Maternal Hospital from the EU at better terms than the Chinese.
He left two questions lingering in the room: would Guyana have been so rigorously pursued had it not been for Oil & Gas? What will we do if we shut down new oil and gas production based on present-day world trends?
In closing, President Ali spoke of some of his government’s challenges. These include the management of sea defenses and drainage and irrigation. He juxtaposed these challenges against Guyana’s natural bounty by citing the four billion dollar valuation of Guyana’s freshwater resources. The Guiana Shield stores around 18% of the world’s tropical forest carbon and 20% of the world’s freshwater. This juxtaposition did much to help the investors better understand the potential, the promise, and the reality of the country his government is fortunate to manage.
Supported by Hon Ms. Oneidge Walrond, Minister of Tourism, Industry, and Commerce, and Dr. Peter Ramsaroop, CIO and CEO, Guyana Office for Investment, President Ali formed part of the first panel on Guyana Investment Opportunities which took several questions from the floor. These questions included plans for port development in Guyana, the government’s timeline for developing Oil & Gas, and its engagement with the Guyanese Diaspora. The President noted the Diaspora’s tremendous potential to aid in Guyana’s development and committed to doing everything possible to remove obstacles for members of the Diaspora to return to Guyana and contribute to the country’s development. He reiterated that there must be an understanding by the Diaspora that they have a role, and they too have a responsibility to pursue the emerging opportunities aggressively.
President Ali’s summary of Guyana’s socio-economic and political climate was fitting. His speech juxtaposed the bonanza of the oil and gas opportunities against the realities on the ground. This pragmatic and hopeful posture likely instilled confidence among the prospective investors as he acknowledged the challenges, setting out programs designed to address them over realistic timeframes. His commitment to reducing Guyana’s energy bill by 50% in 2025 is laudable, but if current geopolitics is anything to go by, his government has its work cut out for it for the next three years. The theme of ‘people transformation’ and his commitment that Guyana will not leave the citizenry behind as the Oil & Gas resources are exploited while protecting Guyana’s environmental and natural resources is challenging. Actualizing this vision will require a cadre of forward-thinking stakeholders to work collaboratively across the various fissures, particularly those of race and class that characterize Guyanese society. President Ali’s recognition of the importance of the Diaspora to the development of Guyana resonated with the audience, particularly with the investors present in logistics and travel businesses. In addition, his plea for Diasporans to organize themselves to participate in the tendering process was well received.
In assessing investment seminars and conferences, getting the right people to ask the right questions of the right person in the right atmosphere is a success. Many of the right people were at this unique seminar organized by The Caribbean Council.
President Ali’s hopeful rhetoric is on target. Guyana indeed offers foreign and domestic investors investment opportunities in agriculture, oil and gas, construction, wholesale and retail, health, transportation, and agro-processing. Opportunities also exist within the services sector such as renewable energy, business process outsourcing (BPO), call centers, information technology services, hospitality, and tourism. Guyana is the only English-speaking country in South America, creating a unique competitive for call centers and other service industries. However, perceptions of corruption persist in Guyana. Transparency International’s 2021 report scored Guyana at 87 out of 180 ranked economies. One key concern for Investors is the insufficient response to a high crime rate. According to the latest World Bank annual ratings, Guyana is ranked 134 among 190 economies in the ease of doing business. The rank of Guyana remained unchanged at 134 in 2019 from 134 in 2018. The major shortcomings: a weak judicial system, lack of intellectual property protection, corruption, and a stultifying bureaucracy. It is by substantively meeting these concrete challenges that the Ali-led government will succeed in increasing, in a sustainable manner, Foreign Direct Investment in Guyana.
Dr. Terrence Richard Blackman, associate professor of mathematics and a founding member of the Undergraduate Program in Mathematics at Medgar Evers College, is a member of the Guyanese diaspora. He is a former Dr. Martin Luther King Jr. Visiting Professor at MIT and Visitor to The School of Mathematics at The Institute for Advanced Study. Dr. Blackman has previously served as Chair of the Mathematics Department and Dean of the School of Science Health and Technology at Medgar Evers College, where he has worked for almost thirty years. He’s a graduate of Queen’s College, Guyana, Brooklyn College, CUNY, and the City University of New York Graduate School. He is the Founder of the Guyana Business Journal & Magazine.
David Fitzgerald Roberts is a graduate of the University of the West Indies in Communication Arts. He writes on socio-economic issues and has worked in journalism across the Caribbean (Grenada, Guyana, and BVI) in the 90s. The holder of a Bachelor’s in Business Administration from the University of Bedfordshire, a Masters in Entrepreneurship / Leadership from the University of Reading, Henley Business School, and a PG Certificate in Business Research from the University of London.
HAPPENING NOW|| The Ministry of Natural Resources in collaboration with the Ministry of Foreign Affairs and International Cooperation is hosting a seminar titled, “Opportunities for the Diaspora in Guyana’s New Economy”. The event is being hosted at the Herdmanston Lodge, Georgetown.
A follow up interview this morning with Dr. Blackman and Boom FM Radio in Georgetown, Guyana on refining the trajectory of Guyana’s Local Content Act. Dr. Blackman reiterated the need for the amplification of efforts aimed at:
- The basing of oil and gas support operations in Guyana;
- The continued development and the broadening of training programs designed to move Guyanese nationals into employment opportunities in the oil and gas value chain;
- Supporting the robust participation of Guyanese businesses in the CLBD to facilitate capacity and competence building for local companies;
- Ensuring that whenever the appropriate competencies are available in Guyana, companies are committed to utilizing them;
- Intentionally engaging Guyana’s disadvantaged communities;
- Facilitating the creation of joint ventures, partnerships, and consortia involving local companies and Oil Majors aimed at seeding local business owners in the oil and gas sector; and
- Reframing corporate social responsibility as a mechanism for creating shared value in Guyana.
Please see interview here https://fb.watch/cnUhF5kCaG/
On February 15th – 18th, 2022, an International Energy Conference & Expo: Charting a Sustainable Energy Future was held at Guyana’s Marriott Hotel. One highlight of the meeting was the panel discussion on Guyana’s Local Content Requirements. The local content bill was passed in the Guyanese parliament on December 29, 2021, and signed into law by President Ali on December 31, 2021.
The Local Content Act outlines forty different services that oil and gas companies and their subcontractors must procure from Guyanese companies by 2022. For example, companies must procure, from Guyanese companies, 90 percent of office space rental and accommodation services; 90 percent of their janitorial services, laundry, and catering services; 95 percent of their pest control services; 100 percent of their local insurance services; 75 percent of their local food supply; and 90 percent of their local accounting services. These are just a few of the areas highlighted in the first schedule of the Local Content Act. By this mechanism, Guyana intends to develop its local economies, stimulate industrial development, increase local business capability, build a skilled workforce, create a competitive supplier base, and transfer the economic benefits of the oil and gas bonanza to the Guyanese population.
The panel, moderated by Christopher Chapwanya, OilNow, traced the evolution of the Local Content Bill and identified some of the challenges and opportunities attendant with its implementation. Panelists included The Honorable Deodat Indar, Minister within the Ministry of Public Works, representatives of the local private sector, and significant oil and gas service companies operating in Guyana.
In this article, I will focus on the contributions of the business representatives Nicholas Sicard, Francesco Prazzo, and Brent Patterson to the panel. I will discuss some of their implications for Guyana’s ongoing local content regime.
Nicholas Sicard, Area Director for TechnipFMC, which installs and operates subsea equipment offshore in Stabroek Block, began by noting that to deliver, effectively, that company’s services required an investment in the team, an investment in local partners, and an investment in the supply chain. As evidence of his company’s commitment to this mission and Guyana, he noted that TechnipFMC successfully migrated all the operations for two projects from Trinidad to Guyana. He also pointed to ongoing TechnipFMC employment onboarding programs likely to increase the number of Guyanese nationals engaged with TechnipFMC initiatives and opined the share of the Guyanese nationals would continue to grow as the spectrum of TechnipFMC endeavors grew.
Francesco Prazzo, General Manager, SBM Offshore, Guyana, shared that SBM Offshore is engaged in designing and constructing FPSOs. As evidence of SBM’s commitment to Guyana, he offered the speed of the construction of the FPSOs and the use of cutting-edge emissions reduction technology in their construction, which has meant more revenues for Guyana earlier than was previously envisioned. SBM’s local content philosophy, he opined, prioritizes integration. He referred the audience to the example of SBM’s operations in Brazil, where they currently operate a fleet of seven FPSOs which is expected to increase to ten (10) by 2025.
He observed that Brazilians are the highest nationality represented in SBM’s Brazilian entities, an illustration that, for SBM, local content was not a mere contract obligation but made perfect business sense. Furthermore, he observed that whenever the appropriate competencies were available locally that SBM was committed to utilizing them. In this regard, he pointed to Guyanese holding the senior management positions, for example, in SBM’s HR functions, and that their finance entities are 100% Guyanese.
He noted that SBM had recently hired eight gravity engineers for whom they organized an 18-month International Program, which brought the participants to the Netherlands, Singapore, and other SBM locations to understand the business and acquire critical competencies. He also noted SBM’s completion of the training of twenty-four offshore operators who are now integrated into the crews of the Liza Basin. He also pointed to a series of 2018 meetings and training sessions hosted by the Center for Local Business Development to prepare local companies to become SBM suppliers.
GM Prazzo defined SBM’s investments in corporate social projects to cultivate and nurture local industries and initiatives as a mechanism for creating shared value in Guyana, not simply as a Corporate Social Responsibility project. In this regard, he spoke to SBM’s efforts to develop sustainable and local food and vegetables and fish locally to feed the FPSO crews and intentionally give employment to disadvantaged communities. Finally, GM Prazzo concluded his remarks by announcing that as of March 01, he would be replaced in his role as general manager of Guyana by Guyanese professional Martin Chang.
The final corporate speaker was Brent Patterson, Regional Director, Americas, Energy, and Projects, Blue Water Shipping, a privately held U.S. Steamship Agency specializing in coordinating Port Calls of Oceangoing Vessels and timely execution of import and export shipments of bulk Grain, Oilseeds, Fertilizers, Steel, Ores, Coal, Petroleum Coke, Minerals, Biomass, LNG, and Oils.
Director Patterson began by sharing with the audience that Blue Water Shipping’s Guyanese initiatives are based on their work in Azerbaijan which started in 1996. He noted that today Blue Water Shipping is the largest locally owned broker freight forwarder transportation company in Baku. He shared that they did so with joint ventures, partnerships, and consortiums and that they followed this model when they came into the Guyanese market. Finally, he pointed to the launching of the Blue Water Academy globally later this year and the fact that the first inductees will be from Guyana.
The inductees will go to Denmark every two weeks per quarter for training. In addition, they will be stationed abroad in Singapore, Dubai, Aberdeen, Amsterdam, Denmark, Houston, Brazil, Rio, or Sao Paulo during the second year in one of Blue Water’s major oil and gas hubs. In keeping with their local content development template, Blue Water recently transferred 51% of the shares of Bluewater Guyana limited to Mr. Richard Vinoba, now the de-facto owner and majority owner of Blue Water shipping in Guyana.
The Guyanese legislature intends for the Act “to provide for the implementation of local content obligations on persons engaged in petroleum operations or related activities in the petroleum sector, to prioritize Guyanese nationals and Guyanese companies in the procurement of goods and services for the enhancement of the value chain of the petroleum sector; to enable local capacity development; to provide for the investigation, supervision, coordination, monitoring and evaluation of, and participation in, local content in Guyana; to promote competitiveness and encourage the creation of related industries that will sustain the social and economic development of Guyana; and for other related matters.”
One of the abiding concerns around local content regimes is that while they help governments achieve specific short-term objectives, they undermine long-term competitiveness, contrary to the express intent of Guyana’s Local Content Act. Moreover, they can have detrimental long-term effects on the country’s economy if they make development more costly or shift too many resources away from other industries. Even before the passage of the local content legislation, active corporate participation in local content initiatives suggests an opportunity for businesses, Government, and Civil Society to harmonize their collective efforts to ensure Guyana’s local content trajectory meaningfully meets the goals set out in the Act and mitigates the diminishing competitiveness concerns. The contours of a locally resonant framework for the Act’s implementation, one that moves us closer to this end, are already evident in the existing business initiatives and local content philosophies described by the panelists. Namely, the amplification of efforts aimed at:
- The basing of oil and gas support operations in Guyana;
- The continued development and the broadening of training programs designed to move Guyanese nationals into employment opportunities in the oil and gas value chain;
- Supporting the robust participation of Guyanese businesses in the CLBD to facilitate capacity and competence building for local companies;
- Ensuring that whenever the appropriate competencies are available in Guyana, companies are committed to utilizing them;
- Intentionally engaging Guyana’s disadvantaged communities;
- Facilitating the creation of joint ventures, partnerships, and consortia involving local companies and Oil Majors aimed at seeding local business owners in the oil and gas sector; and
- Reframing corporate social responsibility as a mechanism for creating shared value in Guyana.
These seven areas should serve as the focal points of the LCR framework for both the Guyanese Government and global corporate entities operating in Guyana. Since the corporate entities are already intimately involved in these efforts, they provide us with a mutually agreed-upon platform to work together to integrate better, refine, amplify, and codify the already existing, locally evolved local content development pathways.
Dr. Terrence Richard Blackman, associate professor of mathematics and a founding member of the Undergraduate Program in Mathematics at Medgar Evers College, is a member of the Guyanese diaspora. He is a former Dr. Martin Luther King Jr. Visiting Professor at MIT and Visitor to The School of Mathematics at The Institute for Advanced Study. Dr. Blackman has previously served as Chair of the Mathematics Department and Dean of the School of Science Health and Technology at Medgar Evers College, where he has worked for almost thirty years. He’s a graduate of Queen’s College, Guyana, Brooklyn College, CUNY, and the City University of New York Graduate School.
3.29.22.10:30A.ET
Gas to Power & Implications for Economic Diversification in Guyana
Gas to Power
Guyanese experience an average of 31 days of power outages per year. Future required generation capacity is estimated to double by 2035, without accounting for the power needs of oil production. Finally, we discuss the implications for Guyana’s economic development of the proposed gas to shore project, aiming to increase peak generation capacity to 400 megawatts compared to last year’s peak of 135 megawatts.
Wales Estate
PRESENTED BY THE GUYANA BUSINESS JOURNAL & THE CARIBBEAN POLICY CONSORTIUM. CPC and GBJ are dedicated to exploring and understanding the Guyanese and Caribbean economy’s critical issues and developing concrete policy proposals supporting the region’s socio-economic and political development. https://cpccaribbean.org/about/, https://guyanabusinessjournal.com
Presenter
Dr. Justin Ram,
Justin Ram Advisory, CEO & Former Director of Economics at the Caribbean Development Bank
Panelists
Dr. Lorraine Sobers, UWI
Roger A. Kranenburg, Eversource Energy, CFA
Dr. David Lewis, CPC
Dr. Terrence R. Blackman, GBJ
Streaming Links
Youtube: https://tinyurl.com/4bxwpm5n
LinkedIn: https://tinyurl.com/52tu5ekv
Facebook: https://tinyurl.com/nr3z2xep
Contact
Terrence Blackman, GBJ
terrence.blackman@gmail.com
David Lewis, CPC
davidlewis@manchestertrade.com
3.29.22.10:30A.ET