Inconsistent data including on exports continues to be an issue here and Guyana’s first Extractive Industries Transparency Initiative (EITI) report found that government agencies’ records on exports were different from one another as well as when compared to companies’ records.
The EITI report was completed by the Independent Administrator – BDO LLP – and submitted to the Guyana-EITI (GYEITI) National Secretariat on Thursday. The report is required to enable full membership of the global transparency watchdog, EITI.
The report, which featured a host of recommendations for the extractive industries, when speaking about the accuracy of export data, pointed out that EITI requirement 3.3 refers to the disclosure of export data for the fiscal year covered by the EITI report (Year 2017), including total export volumes and the value of exports by commodity, and when relevant, by state or region of origin.
“We note that Government Agencies’ records on exports were different from one another as well as from the companies’ records. We understand that the GGMC (Guyana Geology and Mines Commission) and GGB (Guyana Gold Board) do not systematically crosscheck exports data (with) GRA’s (Guyana Revenue Authority) records to identify the potential discrepancies,” the report said.
It highlighted several instances where significant discrepancies were apparent in the export of gold and diamonds.
As a result, the report recommended that both the GGMC and the GGB implement automated controls to ensure the comprehensiveness of the export data reported by mining companies and to develop analysis tools to ensure consistency of exports data with production data.
The report added that this may include putting in place a computerised system to allow for update and oversight of the data, collecting data from mining companies on a common and accessible information technology platform for the relevant government agencies, and performing monthly control of exports data collected from the various agencies to prevent discrepancies in disclosed data.
As it relates to ‘mainstreaming the creation of an open data for EITI’, the report said that in order to improve transparency and promote investment and to comply with the requirement of the EITI standard, agencies should set up an open EITI database in the government systems by implementing and upgrading a cadastral system with adequate details such as data about the shareholders and the beneficial owners of the companies.
Systematic
It also stated that there should be an enhancing of the current management information systems of the government agencies involved in the GYEITI process in order to allow systematic publication of EITI data required to be published in the EITI report; capacity building and raising awareness of government officials on transparency and open data disclosure; and implementing or updating a manual of procedures for relevant government agencies to put processes in place to ensure timeliness, quality of data and cost effectiveness of the systems.
As it relates to reporting on a project level, the report said that it recommends that government agencies ensure that disaggregated payment flows, exports and production by projects can be made available in order to allow the reporting of relevant data at project level by improving the information systems of the government agencies to include the relevant modules for reporting exports data, revenue collections and production data at a project level; and, updating the tax declaration processes and forms to be submitted by extractive entities for the GGMC, GGB, and GRA in order to mainstream information about disaggregation and reporting at project level whenever applicable.
Active licences
The report also noted that it found weaknesses with regards to the list of active licences and permits submitted by the GGMC as the TINs (Tax Identification Number) of the extractive entities were not stated and, as a result, it was difficult to identify companies especially since they did not bear any other identification number. It said that the only means of identifying the licences awarded to the same licence holder was by the entity’s name, which was misspelt from one licence/permit/claim to another. This, the report noted, could lead to inaccurate compilation of data by licence/permit holder and it does not allow the GGMC to conduct proper analysis on the rental fees due by each extractive entity.
It continued that the lists of rights do not necessarily include the names of the extractive entities for which the GGB reported production and these missing names include Grey Wolf Resources, Tesouro Resources, J&D Mining, Wal Jays Mining, Harpy Investment, Higgins Winslow Theophilius and Adamantium Holdings.
It also noted that data on the licensed area detailing the coordinates and surface in the licences, dates of application, dates of award, duration of the licence, are not systematically stated for each right’s details.
“We recommend that an inventory of all active licences should be undertaken in order to capture all relevant details from each licence as required by the EITI Standard. Once the register of licences is comprehensive, GGMC should ensure that the cadastre is kept up to date and that all data on licences is systematically recorded therein,” the report said.
The report noted that it understood that the GGMC is developing an online Mining Cadastre Portal.
It added that the register of licences and permits should include the TIN of the current licence holders or any identification number rather than using the companies’ or individual’s names and that the development of the online cadastral portal should be expedited in order to make available the mining cadastre as required by the EITI Standard.
As it relates to legislative reforms in the oil and gas sector, the report noted that in order to promote a favourable legal environment for investment and in a bid to boost the confidence of private operations in the country, the Multi-Stakeholder Group (MSG) should follow up with the Department of Energy of the Ministry of Presidency to accelerate the reform of the petroleum legislation and how to address any technical barriers delaying the process.
For data quality and assurance, the report recommended that the instructions for next year’s reporting emphasise the importance of complying with the provision of proper signature and certification of templates by auditors according to the requirements of the EITI Standard and efforts should also be made to ensure that reporting entities are adequately notified about the requirements.
As it relates to enhancing the industry’s participation, the report said, “We recommend that GYEITI MSG liaise with their constituency groups, as provided by Requirement 1.4 (b).iii of the EITI Standard, to raise awareness of the importance of participation amongst reporting entities and ensure an adequate timeline for submitting reporting templates within the set deadlines. Notwithstanding the significant efforts already made in this respect, GYEITI may focus on enhancing the communication lines of the EITI Process in Guyana by introducing the EITI Process to extractive entities and Government Agencies through a strong awareness campaign such as conferences and outreach activities as provided by Requirement 1.4 (b).ii of the EITI Standard.”
It also noted that the GYEITI must also set out an adequate timeframe for the reporting process including selection of reporting entities, updating and submitting the reporting templates and instructions for completion, and completion of all reconciliation work.
And in the long term, the report recommends that a review of the mining regulations is introduced with regards to EITI reporting such as reporting obligations for extractive entities while specifying the level of disaggregation of the data to be submitted; and sanctions which could be imposed against extractive entities in the event of non-compliance or false declarations.
“We recommend that, in the short term, application and renewal forms for mining licenses and permits explicitly include a declaration of consent to disclosure of information required for compliance with EITI reporting and that such information be made available in a disaggregated, project by project format,” the report said.
