The Alliance for Change is of the view that the contract that the Government of Guyana has awarded to BP International Limited is shrouded in secrecy. To corroborate its claim, the party drew attention to an announcement by the Ministry of Natural Resources which indicated that the contract shared with the British company is at a market cost of US$0.00 for one year. This reality, according to AFC’s Member of Parliament, David Patterson, is suspicious.
He said during the party’s weekly press conference on Friday that marketing companies would usually charge a commission on each barrel of oil that is sold or charge the Government a fixed base fee per transaction.
“It is vital that further information be provided because no company works for free and this is even more important because the Government’s release is saying the BP International Limited will not only be marketing our oil but will also be providing training and other technical services as well. Obviously, all of these services come at a fee,” he said.
Patterson underscored that one of the principles of the International Secretariat for the Extractive Industries Transparency Initiative (EITI) that Guyana signed onto stipulates that all contracts, including marketing contracts, should be made public.
“The Government is required, if they are going to comply with the EITI standards, to say who the contract benefits and how the company will recoup its money, as well as caveats,” he added.
Energy expert and former Executive Director of the Environmental Protection Agency (EPA), Vincent Adams, posited that service companies like BP International Limited are known for compartmentalizing costs.
“Every contract has to pay for itself, so they just cannot go and spend corporate money,” he stated.
It is anticipated that BP International Limited will provide support and guidance to Guyana in all operating and back-office responsibilities of managing the crude sales and each individual lift while facilitating timely and cost-effective crude operations and supporting the government in the continued introduction of the grade to multiply geographies and refinery systems.
Providing benchmark and performance comparisons of prices paid to Guyana’s crude and working closely with the Government to understand the behaviour and yields of the Liza blend and how these can affect pricing differentials also form part of the services the company is expected to offer.