Government should say why after three years of oil production the regulatory Petroleum Commission has not been established, Opposition Member of Parliament David Patterson says.
Patterson says that the offshore oil blocks which will go to auction soon and the regulations for the gas to shore power company, which comes on stream next year, should be guided under that regulatory body.
“It is a worrying non-development that we still have no Petroleum Com-mission, as you can recall, a draft bill was tabled in the 11th parliament (by the APNU+AFC government) and sent to a special select committee – the PPP and members of the public requested this route. Three years on, they have not amended or even presented their draft,” Patterson lamented as he called for government to update on the progress.
“…The government has confirmed that they have signed a sales agreement with ExxonMobil [for the gas to shore project], no one knows if it’s an amendment to the existing production contract or a new agreement. Who are the parties to this agreement or what are the terms? We hear about a new company, Guyana Gas and Power [and] it appears that this company has some of the powers that would be under the commission, but no details have been provided other than the names of the directors,” he added. Patterson lamented on what he believes is government’s sloth in forming the Commission that will be the main oversight body for the petroleum sector, as he posited that information is hardly every forthcoming from government, until pressured by criticism.
“The oversight of the petroleum sector is now in the sole control of the PPP, and they have not been forthcoming with information. In fact, since coming to power…the country is left to hear about our achievements via public statements by the operator…,” he said while singling out Stabroek Block partner Hess. But of key concern, Patterson told the Sunday Stabroek, was that this country this week hosts its biggest oil and gas conference and will discuss the vacant oil blocks for auction, to mainly western countries who operate under strict regulations, yet there is no Petroleum Commission here. He said that the oil blocks auction announcement came with a promise that the documents pertaining to processes for how it will be executed will be released but the nation is still waiting.
“In a couple of months, oil blocks will be up for sale, once again the nation knows little about this process, they did not even release the supposed revised documents which they promised,” he said. Patterson said that with additional oil discoveries imminent, regulations for the sector are needed more now than before. He wants government to say when the process for the establishment of the commission will commence. Just after the PPP/C government was sworn in on August 2nd 2020, current Minister of Natural Resources Vickram Bharrat had said that the Commission was a priority. He had told Stabroek News in an August 6th 2020 news item that he hoped that as soon as the 13th Parliament began that the Petroleum Commission Bill would once again be tabled, as his government believed that it is needed for the sector to be insulated from political interference before major decisions for the sector are 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 had told Stabroek News in an interview following his swearing in.
Languishes
“The Petroleum Com-mission 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 Com-mittee. Such a special Bill that will reduce political interference in the managing of that sector I believe is needed to ensure transparency,” he added. More than 30 months on, his administration is still to deliver a bill.
Minister of Legal Affairs and Attorney General, Anil Nandlall SC, had also underlined that the Petroleum Commission Bill was a priority for the government and they would be working to ensure that it was 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 had said in the August 6th 2020 news item. He stressed the importance of having a Bill that reflected 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 stoutly criticised it, questioning the powers granted to the Minister of Natural Resources. Current President Irfaan Ali had also been most vocal in his criticisms of the bill while as an opposition MP 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 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 etcetera. 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 had added.
