Discussions on Guyana oil/gas find

Hughes made the statement while delivering the first lecture, Guyana: New Frontier, on the opening day of the Second Oil and Gas Law Conference held by the Faculty of Law of the St Augustine Campus of the University of the West Indies at the Hilton Trinidad, St Ann’s, on Thursday.

He said the proposal followed the oil and gas discovery in Guyana’s Liza 1 field, 120 miles offshore in May 2015, when Exxon discovered 800 million-1.4 billion barrels of oil and gas, which he said were staggering numbers for a country which had no history of oil exploration and a Gross Domestic Product (GDP) at the time of only US$3.6 billion. He said the discovery was one of the richest oil and gas finds in the world for decades.

The two-day conference was sponsored by BPTT, Shell and eog resources and closed yesterday. Day one also featured a panel discussion on local content in the energy sector, in which Dr Ekpen Omonbude, economic adviser (natural resources) at the Oceans and Natural Resources Advisory Division of the Commonwealth Secretariat, said among other things that in building local content, clarity was important, because if something meant different things to different people, there was a good chance that it would be done differently.

He said the advantage could be an overall improvement in quality and systematic valuation, though the downside was that the country could become too risk-averse and the policies end up focusing on the “small stuff.” He said policies also needed to be adaptable. He urged the early integration of procurement strategies of companies into the planning of countries, saying that the companies always knew before the countries what the skills were, and the country could then try to fit them into their national development plans.

Anthony Paul, chairman of the Local Content Committee, traced the development of local content in Trinidad and Tobago. He referred to the late Lloyd Best’s theory of the plantation economy, in which, he said, locals are only trained to build and operate an asset, but the skills to develop the business plan and source financing are kept at the head office of the international companies which own those facilities.

However, he said during this country’s gas development phase it was forced to build those skills because it had to get its own ships and management contracts and this was learnt during the development of the Point Lisas Industrial Estate.