Govt should develop a long-term plan to manage oil

first_img…an “old problem” for resources to be mismanaged – HindsAssociate Professor and political activist David Hinds is imploring the government to not make the same mistake as Trinidad and Tobago did by not developing a long-term plan to manage its oil resource.Dr David HindsAlthough the discovery of oil is welcoming, Hinds in an interview with Guyana Times stated that government should start taking the necessary steps towards the proper management of the resource. He highlighted that it is an “old problem” for Guyana’s resources to be mismanaged, in terms of foreign investors being the prime beneficiaries of the resources.He said this “old thorn” has not been removed because Guyana is not single-minded about confronting and solving the issue of Guyana’s resources being mismanaged.“For example, we have our gold. However, there is no processing plant to refine our gold and so the gold is extracted in its raw state and shipped out to be refined. And what do we gain – a percentage,” he explained, noting that it is the same with other resources.Recently, ExxonMobil discovered that the second exploration well in the Stabroek Block offshore Guyana has a recoverable resource of between 800 million and 1.4 billion oil-equivalent barrels. The wells are located approximately 193 kilometres (120 miles) offshore. The block is 26,800 square kilometres (6.6 million acres).Esso Exploration and Production Guyana Limited holds 45 per cent interest in the Stabroek Block; Hess Guyana Exploration Ltd holds 30 per cent interest and CNOOC Nexen Petroleum Guyana Limited holds 25 per cent interest.ExxonMobil is the largest refiner and marketer of petroleum products while its chemical company is one of the largests in the world.According to Hinds: “There is always the overemphasis on attracting foreign investment. I think the same emphasis should be put in developing internal mechanisms and economic structure. So we should invest in small businesses, in our local investors.”Hinds alluded however, to the deficiency of the skilled human resources and to that end insisted that before Guyana begins to envisage managing oil on its own, it should start investing in its people first. He stated that government should encourage Guyanese to develop the skills necessary to build an economy around oi: “We should start investing in having locals trained in oil engineering for the future….we would need lawyers to handle cases of petroleum issues.”Education Minister Rupert Roopnaraine had disclosed that he had proposed to the authorities of the University of the West Indies (UWI), St Augustine Campus, to develop a petroleum engineering programme that would prepare Guyana to manage its potential oil industry.Petroleum engineering is the study of the extraction of oil, gas and other natural resources from the earth. This is accomplished through the design, drilling and operation of wells and well systems, and the integrated management of the underground reservoirs in which the resources are found.Hinds suggested that Guyana needs to start envisaging a whole new economy around oil and start now: “It is not about pumping the oil out from the ground and selling it and getting the money…if Guyana is going to benefit from oil we have to build up an enabling economy…an offshoot economy.”Oil refineryThe Associate Professor indicated that if Guyana cannot develop its own oil refinery, then the country should partner with Caricom countries to construct one. “That is the way to go…that is why we have Caricom…” he stressed.“It would be nice if we can have our own oil processing here but if we cannot do it by ourselves then we can partner with sister Caricom countries to do,” he said, explaining that this is what a single market is about.He noted that if Guyana and Trinidad could develop an arrangement where they can both manage a future oil refinery in Guyana, then both Guyanese residing in Trinidad and Guyana would benefit.“It is either we have our own processing plant or we do it through a regional emphasis,” Hinds stressed.Ministers of Natural Resources and Finance Raphael Trotman and Winston Jordan are currently visiting Uganda to gain knowledge on the strategies that country has employed to manage and develop its oil resource.last_img read more