Computer scientist and teacher Vickram Bharrat was yesterday appointed Minister of Natural Resources and will head the oil & gas industry, underscoring that with the sector expected to be this country’s top revenue earner, his priority will be the establishment of a Petroleum Commission.
While President Irfaan Ali said that the sector will again fall under the ministry, Bharrat said that the new government has not yet decided if the Department of Energy will be kept.
The Minister of Natural Resources hopes that as soon as the 13th Parliament begins that the Petroleum Commission Bill will once again be tabled, as his government believes that it is needed for the sector to be insulated from political interference before any major decisions for the sector could be made.
“Oil to a country could be a curse or a blessing, but it all depends on the management of that sector. The oil and gas sector will definitely need management in terms of responsibility and transparency in keeping with the Santiago Principles and that is what we intend to bring to the ministry,” he told the Stabroek News in an interview yesterday, following his swearing in. The Santiago Principles pertain to sovereign wealth funds.
“The Petroleum Commission Bill was tabled by the previous administration about three years ago and sent to a special select committee. Unfortunately, that bill still languishes in that Special Select Committee. Such a special Bill that will reduce political interference in the managing of that sector I believe is needed to ensure transparency,” he added.
Bharrat further explained that Ali will tomorrow be meeting with his entire Cabinet and Ministers to set a clear plan for each sector and the job portfolios of each will discussed and completed then.
A decision on whether the Department of Energy will be kept will be made then and Bharrat said that he will be meeting today with the staff of his ministry to gain an insight into operations before meeting his President the next day. “As it is now, we will have the Department of Energy,” he said.
President Ali had told reporters that when decisions on the sector are made it will be shared with the public. “We are going to share this with you. We are going to share with you as soon as we have crystalized the TORs and areas of responsibility for every ministry and we are going to have that gazetted.”
Asked if he was responsible for the oil & gas, Ali said, “There is a ministry of natural resources” and again stressed “Can you wait until we have that finalised?” when asked about his role with the President being the Minister of Petroleum.
Minister of Legal Affairs and Attorney General Anil Nandlall echoed that the Petroleum Commission Bill was a priority for the government and they will be working to ensure that it is swiftly returned to Parliament. “While we were in opposition, we had some fundamental conceptual problems where it was felt that there was an overconcentration of power to politicians. As a result we withheld our support on the floor. The Minister at the time, Raphael Trotman, expressed some reservations about the Bill and he had asked it to be sent to the special select committee,” Nandlall explained. He stressed the importance of having a Bill that reflects the best for the people of this country and also the benefits of the establishment of the Commission.
The Bill was first presented to the National Assembly in May of 2017 and returned for its second reading and debate one month later. The People’s Progressive Party/Civic, then in opposition, had staunchly criticised it, questioning the powers granted to the Minister of Natural Resources.
Vocal
It was now President, Dr Ali who had been most vocal in his criticisms of the bill and objections were also raised by the PPP/C, about the lack of independence of the commission, general governance, and its ability to operate in a non-discriminatory and apolitical manner.
“When we examine section 8 which deals with the Power of the Minister to give directions to the Commission, it is clear that the Commission will hardly be able to work without the direction and control of the Minister. According to Section 8, the Minister is not only allowed to provide policy guidance, but also give direction to the Commission regarding, size of the establishment, the employment of staff and the terms and conditions of employment, the provision of equipment and use of funds, reorganization of such works of development as to involve a substantial outlay on capital account, training, education and research, the disposal of capital assets; the application of the proceeds of such disposals,” Ali, then PPP/C MP, had stated .
“Thus, the Minister is literally empowered to dictate inter alia, how many persons an independent Commission should employ, what should be the terms and conditions of employment for the staff of the Commission, how an independent Commission should use its funds et cetera. Based on our review of similar legislation in other countries, we were unable to locate one that bestows comparable powers to the Minister. Indeed, based on our review we found that the only power the Minister is granted in other countries is the power to provide policy guidance,” he added.
Chatham House Fellow and Project Head of the New Petroleum Producers Discussion Group, Dr Valerie Marcel has also underscored the importance of insulation of the Petroleum Commission from interference.
The revised Petroleum Commission Bill was expected to return to Parliament in late 2018 but the December 21 No Confidence Motion that felled the APNU+AFC government saw it being shelved. The revised version, which was seen by this newspaper would not only have significantly reduced the powers of the subject Minister, it also incorporated clauses aimed at ensuring its independence, transparency and accountability.
Provision was also been made for at least two women to be on the Board of Directors of the Commission and the bill now caters for both genders, according to excerpts of the reviewed Bill.
Moreover, and considering that Guyana is a frontier oil and gas country with no data on petroleum, a recommendation by the World Bank, which had helped with the review and redrafting of the Bill, stated that Guyana should establish “and manage a national data repository for digital/soft petroleum data, including digital/soft data as well as hard/physical data such as core samples, cuttings and fluid samples, and manage and undertake research of the petroleum data and a central database of operators and other persons involved in petroleum activities.”
Bharrat said that he hopes that there is law governing operations of the sector “Because we have seen so many corrupt deals already and that is something we want to avoid from the very inception so that the proceeds from that sector can benefit all Guyanese.”
And while he has no experience in the sector, Bharrat said that he believes that he will perform well and is up for the challenge. “Natural resources is a challenge and it requires good management and dedication. And I believe that natural resources can break or make this country…depending on how well we manage these resources,” he said.
He added that he already has plans to boost local content capacity in the oil & gas sector while creating jobs both directly and from spin-offs of the sector.
The PPP/C had heavily criticized the APNU+AFC government when then Director of the Department of Energy Dr Mark Bynoe was appointed saying he lacked the experience to oversee such an important sector.
Former Petroleum Advisor Dr Jan Mangal had said that a person overseeing oil and gas, then with the Department of Energy being agency responsible for the sector, should “be someone with international gravitas, someone who could challenge the likes of [former US Secretary of State and former Head of ExxonMobil] Rex Tillerson, for example, who was comfortable talking [oil and gas] with Ministers from the major producing countries and the top executives from the major oil companies.”
