Petroleum Advisor in favour of politicians having less control of oil industry

For Guyana to be successful in the oil and gas industry, the oil must be kept offshore with no thoughts about an oil refinery, at least for the first years and revenue from the oil sales should be used to develop the infrastructure of the country, according to the Presidential Adviser on Petroleum, Dr Jan Mangal.

“We have an opportunity now to not get too much in bed with oil. The way to do that is to keep the oil offshore, oil shouldn’t come ashore. All Guyana should focus on in the next 10 years is revenue. Get the revenue and with the revenue transform Guyana,” Dr Mangal told a gathering at the University of Guyana last week.
He was at the time presenting a discussion on the Government’s vision for the oil and gas sector. He told the gathering that there are many examples for Guyana to follow where it comes to what not to do in relation to managing its petroleum industry. He made specific reference to how Trinidad and Venezuela managed their industries, resulting in the collapse of the Venezuelan economy and the “quandary” Trinidad now finds itself in.
He noted that oil is not needed to transform Guyana, rather it is just the revenue that is needed.
“Bringing oil ashore now would be a shock to the system in Guyana. Guyana will be too tied to the oil industry… Guyana needs to go in and pull in a bunch of experts into Government and my intention was to build a team up but unfortunately the resources are not there to do that but we are working on it,” he said.
Dr Mangal explained that by bringing the oil ashore at this point it would foster no change since most of the jobs would be given to foreigners. He further stated that Guyana does not have the technical expertise to take up work in the oil refinery, if built, hence the reason an oil refinery would be ideal after the first five years of production.
“Guyana has zero capacity to deal with oil and gas. There are some basic things we need to learn, we need bills, we need technical people in the Ministry of Natural Resources, the Guyana Revenue Authority, the Ministry of Finance and they are not here. It has been two years now and go look in the Ministry of Natural Resources and see how many foreign technical experts are there – zero,” he underscored.
“It is better to take the revenue, transform UG and hospitals and it will be beneficial for local people. Guyana is at a stage now because of global warming and rising sea levels where it has to decide where to invest,” Dr Mangal added.
He further explained that the leadership of Guyana now needs to decide if it is time move more inland in light of global warning and rising sea levels.
“So we have to keep the oil at a distance and getting the revenue and maximise the revenue and then not squander it, spend it wisely,” he said.
Take control from politicians
According to the Presidential Advisor, politicians only think from election to election and as such, the control of the oil and gas sector should be taken away from them in order to prevent the industry from being further divided racially and politically as well as creating uncertainty in the decision-making process.
The Presidential Adviser indicated that he has already brought that up with the Administration to ensure that there are steps to combat that.
“In my presentation to Cabinet last year March, the way I try to scare them or convince them is to say that we have to get it right now. You don’t know who is going to be elected at the next election so this is the opportunity now to set up the most robust systems that are more robust against meddling by politicians, so let’s set up strong systems now where we remove too much decision-making by politicians,” Dr Mangal informed.
“The industry should be managed by civil servants. If we take that path, changes in Government will not impact the oil industry. If politicians are managing your industry, then come election time the industry is going to come to a standstill and six months after the elections, there won’t be anyone working in the industry; scrambling to find people,” he added.
In March 2020, ExxonMobil and its production partners are expected to begin bringing up oil – an estimated 120,000 barrels per day – from 17 wells offshore Guyana.