Transparency Institute Guyana Inc (TIGI) has flayed government’s unilateral decision and the undisclosed terms of the deal with Saudi Arabian company, Aramco Trading Limited to market this country’s next 1 million barrels of oil.
“We have not been focusing solely on oil but the entire procurement and we are not surprised that this has happened,” President of TIGI Fred Collins told Stabroek News yesterday.
“There seems to be a complicity in ignoring the requirements of the Procurement Act. The final analysis is an award of a service to government of which its value is higher than the limit [allowed by the law] without any procurement. Even if the government wanted to say it is single-sourced and an emergency, which it is not, they are not saying or even disclosing the terms of the agreement promptly to the nation,” he added.
Even as the country awaits word on who would market Guyana’s oil share for the next one year period, government announced on Saturday that Aramco would be selling the next lift of oil, scheduled for some time later this month.
Several efforts to contact Minister of Natural Resources Vickram Bharrat yesterday again proved futile. Bharrat has not been available to this newspaper for several months now and a number of questions posed on the sector are still outstanding.
The Aramco arrangement mirrors that of the last three sales this year where the public was only made aware through the press and only after the deals had been completed.
Those lifts were made on the 5th of February, 13th April and the 3rd of July.
Since first oil, this country has received seven lifts with the first three marketed by Shell Western under an arrangement approved by the former APNU+AFC administration.
When the PPP/C took office in August of 2020, Vice President Bharrat Jagdeo had said that it formulated its own arrangement and Hess was chosen to market the December sale.
“The last two shipments, what we would have had to do was to get three bids from Hess, Exxon and CNOOC. The bid that won was Hess. They gave the best terms. We don’t know about the shipment in February but all are selling at Brent preference. All are selling at the same price but the difference is in marketing commission etcetera,” he had said in February of this year.
It is unclear why or when the agreement with Hess was terminated.
The oil lift that came after Hess’ two was marketed to the Indian Oil Corporation in what appeared to be a bilateral arrangement between Guyana and India.
Vocal
The recent announcement on Aramco raises transparency questions for the PPP/C government which had been very vocal and had criticised the APNU+AFC when it had unilaterally decided that it would engage potential buyers for Guyana’s first three 1M barrels of oil.
In addition, the promised online portal that would give the public real-time data tracking of a sector that is expected to be this country’s highest revenue earner for at least the next 30 years is yet to materialize or citizens updated on the process.
“Following a transparent public procurement process for the Provision of Marketing Services for the Cooperative Republic of Guyana Oil Entitlement from the Liza Destiny FPSO Vessel, the Government of Guyana has recently evaluated and approved for the nomination of ARAMCO TRADING Limited (ATL) to market Guyana’s 4th lift for 2021, scheduled for September 21 – 22, 2021.The evaluation process included administrative, technical and financial assessments, which saw submissions from (15) firms. ATL (was) identified as the lowest compliant evaluated bidder at price of $0.025 USD per barrel,” the statement said.
Aramco is one of 15 companies that are being evaluated to market this country’s oil share from the Lisa Destiny for the next one-year period.
The US 2.5 cents commission quoted in the release as the lowest compliant bidder is the same amount that the company bid in the current process being evaluated and it was the second lowest commission per barrel tendered.
In that procurement process, the Chinese-owned Sinochem International Oil Company Ltd which is registered in London had submitted the lowest proposed sum at US 2 cents.
However, no notice has been provided that the firms were invited to bid separately to market the September lift of oil and the government could not have arbitrarily taken the figures provided for the one-year deal and applied them to the September lift to determine which of the companies should have the marketing opportunity.
It must be noted that National Procurement and Tender Administration Board (NPTAB) evaluation doesn’t only focus on the lowest commission but responsiveness is measured through a number of factors. The NPTAB website has no record of the approval of a deal for the September lift.
This newspaper was told by NPTAB officials that the evaluation process for the one-year contract had not been completed and to check with the Ministry of Natural Resources (MNR) as it had announced the Aramco deal as an interim arrangement.
“The evaluation is not completed. However in the interim, the Ministry of Natural Resources have an existing arrangement to market each lift. (Please) contact them…,” an NPTAB official said.
However, there is no evidence of the government inviting bids for the September lift to be marketed.
And while the MNR release said that that Bharrat “notes the Government’s commitment to securing the best agreements for the country and further pledges to the maintenance of the highest level of compliance and transparency to ensure that the benefits from this sector improve the lives of all Guyanese”, TIGI said government talks about transparency but there is not enough action to back it.
“So clearly what we have is a situation where the officialdom has acculturated the society, much to the satisfaction of those that had something to gain from it, including those who are supposed to be on the side of the Guyanese people that they can ignore the Procurement Act with impunity,” the TIGI President said.
The press was not spared by Collins who said that enough was not being done by the fourth estate to hold government accountable. “I don’t think that the press has been responding in a way that is required,” he posited.
“So we have not been focusing on the oil alone but the macro situation as pertains to procurement and we have not lost sight of what is happening,” he added.
