Page 5 - LatAmOil Week 01 2022

LatAmOil COMMENTARY LatAmOil

It aims to maximise local employment and keep to make a case for the NRF bill. A video taken
a larger share of the money invested in oil and at the event showed one opposition MP using
gas projects circulating within the Guyanese racial slurs to address a Parliament staff member
economy. who was lying on the floor trying to keep hold of
Meanwhile, the NRF bill incorporates Guy- the speaker’s mace.
ana’s existing oil fund, which is currently held Despite this episode of mayhem, the PPP/C
by the US Federal Reserve Bank of New York, majority did succeed in passing both bills later
into the country’s broader legal system. This on December 29, and Ali signed them into law
will make the fund subject to the rules and pro- on December 31. IOCs and their foreign con-
cedures that are already in place to govern the tractors will now have a grace period of one year
allocation and use of public funds, including the to achieve compliance with the local content law.
checks and balances between different branches
of government. Underlying tensions
The incident on December 29 stems partly from
Getting the laws passed the fact that the differences between PPP/C and
As noted above, most of the corporate players APNU+AFC are not purely political in nature
involved in Guyana’s oil and gas sector seem to but also ethnic, historical and economic.
be more or less satisfied with the two bills. Exx- In very broad terms, PPP/C is most pop- The differences
onMobil and the other IOCs working in the ular among voters of South Asian origin who between
country have not commented publicly on the descend from indentured labourers brought to
matter, but business organisations have done the region by colonial rulers between the mid- Guyanese
so. The Georgetown Chamber of Commerce 1800s and early 1900s. APNU+AFC, by con-
and Industry (GCCI), for example, has been trast, has more support among voters of African political parties
vocal about its support for both measures, as origin descended from slaves brought forcibly
has the Guyana Oil and Gas Energy Chamber to the Western Hemisphere at an earlier date. are not purely
(GOGEC). Traditionally, the country’s Indo-Guyanese citi- political in nature
Guyana’s main opposition faction, by con- zens have been more involved in the agricultural
trast, aired many complaints about the bills after sector, especially in sugar and rice farming, and but also ethnic,
they came up for debate in Parliament in late have made up a larger share of the rural popu-
December. Members of the APNU+AFC (A lation. Meanwhile, its Afro-Guyanese citizens historical and
Partnership For National Unity + Alliance For have been more involved in the mining indus-
Change) coalition expressed particular concern try and have made up a larger share of the urban economic
about the provisions of the NRF bill that gave population.
the president the power to appoint the govern- Since Guyana gained independence in
ing board of the sovereign wealth fund, saying 1966, there have been efforts to bridge the gaps
that this put too much power in the hands of a between these two population groups, with
single elected official and might politicise the some degree of success. Nevertheless, tensions
NRF, to the detriment of the country. They also certainly remain, as recent events in Parliament
aired other substantive critiques, such as a call demonstrate. They also played a role in the 2020
for further review of specific sections of the local presidential election, which came to a rough
content legislation. and awkward end after Ali’s predecessor David
However, their criticisms were mostly over- Granger refused to concede and remained in
shadowed by the news on December 29 that office for five months after his defeat. As such,
opposition MPs had reacted to the news that Guyana’s political scene bears close watching as
the NRF bill would be debated ahead of a vote oil development moves forward.
rather than passed to a special select commit- Of course, all of the parties involved have a
tee by storming the speaker’s podium. This act financial interest in making sure that oil reve-
triggered chaos in Parliament, with opposition nues continue to flow into the Guyanese treas-
MPs attempting to seize Speaker Manzoor ury at the highest rate possible. Even so, they
Nadir’s mace by force and government MPs and also have reasons to try to direct the largest share
aides attempting to mount a physical defence of possible of that money into their own commu-
Finance Minister Ashni Singh, who was present nities. As such, IOCs ought to step carefully. ™

Liza Destiny FPSO at Liza-1 oilfield offshore Guyana (Photo: ExxonMobil)

Week 01 06•January•2022 www. NEWSBASE .com P5