The Government of Guyana on Friday received a US$20 million loan from the World Bank to support capacity building for Petroleum Resources Governance and Manage-ment.
A release yesterday from the Ministry of Finance stated that government, recognizing the risks associated with being a new oil and gas producer, negotiated the loan to address governance and management risks from inadequate policy, legal and regulatory frameworks and institutional capacity. The loan was approved on Friday.
It was stated that the components of the loan reflect the reality that the oil and gas sector will affect multiple layers of the economy and impact the livelihoods of present and future generations, the environment and local communities. If the sector is poorly managed, it was noted, this can have costly economic and social impacts for the country.
“Additionally, there are environmental and social risks – usually infrequent but with high impact – associated with O&G production that require effective and constant monitoring, as well as significant investment in environmental damage prevention and response capacity, among others,” the release noted.
As such, the release noted that government is keen on investing in strengthening its institutions and building capacity to manage oil and gas resources.
“Therefore, the Project envisages that Guyana’s legal and regulatory frameworks for the O&G sector will be reviewed and updated with a view to maximizing benefits to the country and affected communities; managing the technical, environmental, social, and financial risks linked to the sector; and building capacity to engage effectively with investors. Institutional capacity to oversee and manage the O&G sector in the various relevant government ministries, commissions and other departments will be created using consultants, initially, but with a view to ensuring local personnel are trained to replace these technical advisers over time,” the release said.
