As the country seeks to attract investment, Head of the Department of Energy Dr. Mark Bynoe has said that it must be done in a way that balances the interests of investors and benefits to the citizenry.
“Guyana is seeking to encourage business, not discourage it, but it must be in a balanced manner, where Guyana and Guyanese benefit proportionately, whether it be in the form of local business sector support, project participation, joint ventures or fulfilling of one’s corporate social responsibility,” Bynoe said on Friday. “We are working to ensure that our people benefit, and benefit appropriately from the exploitation of their natural resources. Our hospitality must not be taken for granted,” he added.
He was at the time delivering the keynote address to attendees at a launching event held at the Marriott Hotel to mark the opening of a new branch of Hughes, Fields and Stoby in Houston, United States, where the local law firm hopes to tap opportunities in the oil and gas sector.
Bynoe called on Guyanese to be prepared for the “tectonic shift” in this country’s development trajectory, saying that they must be prepared and well positioned to both contribute to and benefit from it.
Exxon’s find of over 4 billion oil-equivalent barrels in the Stabroek Block, offshore Guyana, will be the main catalyst for the transformation.
Defining government’s role in the new industry, Bynoe said that it wants to see its citizenry thrive and all of its policies and plans will be crafted and executed to ensure that practical approaches are taken in the best interest of its people.
As a result, his department has been given the mandate, albeit in its current infancy, to govern and administer the nation’s upstream and mid-stream oil and gas resources, while simultaneously maintaining stakeholder engagement in the hydrocarbon sector of the economy on a continuous basis.
The direction the department is seeking to pursue, he said, is to follow its mandate even as it focuses on adopting best practices to facilitate the “optimal development of the country’s hydrocarbon resources.”
But he was quick to remind that hydrocarbons are non-renewable resources and therefore Guyana would be focused on transitioning towards much cleaner, more sustainable and secure forms of energy generation, in keeping with the Green State Development Strategy (GSDS).
“Central to this recalibration, will be the governance structure implemented and the conscious effort to continue to promote the GSDS as a vehicle to benefit all of Guyana,” he said.
Immediate and near-term plans by his department will include a number of strategies, such as “setting the legislative framework in place, inclusive of the completion of rationalisation of the requisite legislation and regulations; completion of the Local Content Policy, the Petroleum Commission Bill, the architecture for the operationalisation of the Natural Resource Fund (NRF), Petroleum Exploration and Production Legislation and Regulations, and Petroleum Taxation and Fiscal Legislation; having a good understanding of top side and sub-surface mineral deposits through having the requisite analyses conducted and databases held; understanding the global trends in markets, technologies and market structures, inclusive of better economic modelling and forecasting and varying and modifying a range of assumptions underpinning these models; and regulating the requirements and conditions of exploitation….”
Further, he also listed “Enhancing contract administration; developing an effective and transparent system for allocating production rights, inclusive of completing a model Production Sharing Agreement (PSA); reducing revenue leakage through recruiting the required technical expertise; adopting effective mechanisms for controlling licences, contracts and operations; and developing domestic capabilities along the value chain through training and mentoring programmes and attachments, as well as participating in the new petroleum producers group.
But for the department’s goals to be realised, it will require strong partnerships, internal cohesion, and a well-coordinated approach for the deployment of substantial resources and a variety of expertise and capabilities, Bynoe believes. “It is for these reasons that the Department continues to seek to engage with those who have a mandated responsibility and others that may have a competitive advantage in a particular area which can be used to the benefit of all Guyanese. Furthermore, given the magnitude of effectively and efficiently managing the hydrocarbon sector, a mixture of public and private sector engagement would appear most feasible at this time,” he said, while noting that “It is not the expectation that all “i”s will be dotted and “t”s crossed before we achieve all our stated objectives, but rather a phased development will be the best modus operandi.”
