Page 5 - LatAmOil Week 17 2022
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LatAmOil                                     COMMENTARY                                            LatAmOil


                         Guyana’s Prime Minister Mark Phillips, a   industry and was not owning up to its mistakes.
                         retired brigadier, also spoke positively, saying:   “I don’t know if they have a problem with
                         “I look forward to more developments that will   truth, but the fact of the matter is that the econ-
                         come from these and other shows of commit-  omy is undiversified and it relies heavily on oil
                         ment to Guyana’s future growth and economic   and gas,” he was quoted as saying by OilNOW.
                         well-being.”                         gy. “And when the prices fall, things start to fall
                           But the commissioning ceremony was not   apart, and they are facing some of those conse-
                         just a happy corporate milestone to be marked   quences now.”
                         with upbeat statements and positive PR. It also   In the meantime, there are other underlying
                         marked a geographic shift – and may serve as a   issues at work. Jagdeo was speaking shortly after
                         reminder that political tensions can surface as   Ramesh Dookhoo of the Guyana Manufactur-
                         one hydrocarbon province matures and another   ing and Services Association (GMSA) answered
                         comes to the forefront.              questions about his own country’s local-content
                                                              policies by reiterating a long-standing complaint
                         Geographic shift                     about honey transshipment policies in Trinidad
                         The shift in question involves TechnipFMC’s   and Tobago.
                         decision to move operations previously carried   Addressing Mahindra Ramesh Ramdeen,
                         out from a facility in Trinidad and Tobago to   the CEO of the Trinidad & Tobago Manufac-
                         its new base on the East Bank of the Demerara   turers’ Association, at an event in Georgetown,
                         river. Landes made note of the change, saying   Dookhoo said: “We will respect Trinidad’s pri-  Relations
                         the company had now “successfully transferred   vate sector more when you advocate some of
                         all activities done in Trinidad to Guyana.”  the things that bother us, like your illegal honey   between Trinidad
                           Routledge indicated that he saw the move to   legislation, which is on the books and going on
                         Guyana as a positive development, remarking   for years and years and years.”  and Tobago and
                         that ExxonMobil had previously been forced to                             Guyana predate
                         rely “heavily” on established facilities in Trinidad   Frontier vs. mature fields
                         and Tobago. He called TechnipFMC’s expansion   The spat over honey transshipments is, of course,   the discovery of
                         project a “shining example” of Guyana’s push to   not directly relevant to the oil and gas sector.
                         improve and expand its infrastructure networks.  However, it does raise important points. It   hydrocarbons in
                           These remarks were probably well received   serves as a reminder that relations between Trin-
                         in Georgetown, which has been working hard to   idad and Tobago and Guyana predate (and are   either country
                         ensure that the country’s burgeoning oil indus-  not dependent on) the discovery of hydrocar-  and are not
                         try has strong local-content and job-creation   bons in either country and that those relations
                         components – that it has a distinct Guyanese   are not always smooth.      always smooth
                         flavour, that is. But they were probably greeted   It also highlights the fact that these tensions
                         less warmly in Port of Spain, where govern-  can surface at times when industries that are
                         ment officials have spoken repeatedly about   important to the local economy, such as oilfield
                         the readiness of Trinidad and Tobago’s oilfield   services, decide to scale down operations in
                         service providers (OSPs) to support operations   one place and ramp them up in another. These
                         in Guyana, Suriname and other locations in and   tensions may become more noticeable in the
                         around the eastern Caribbean Sea. (The island   coming years as new service bases are built in
                         state is home to many such companies, most of   Guyana (and in neighbouring Suriname as
                         them built up to support local onshore and off-  well), a frontier hydrocarbon province, espe-
                         shore natural gas production.)       cially if OSP activity slows down in Trinidad
                                                              and Tobago, where many fields are maturing. ™
                         Underlying considerations
                         For parties such as ExxonMobil, meanwhile,
                         the location of service bases is a matter of
                         practicality.
                           While it may have made sense to work out of
                         facilities in Trinidad and Tobago several years
                         ago, before production began at Stabroek, it
                         is probably more economical to work out of a
                         closer facility on the Guyanese coast now that
                         drilling and other marine service operations
                         at the block are more extensive. As such, Rou-
                         tledge’s talk of being forced to rely “heavily” on
                         bases in Trinidad and Tobago may be more of a
                         comment on geographic distance than a com-
                         plaint about that country per se.Nevertheless,
                         such remarks can sting when they come in the
                         wake of other criticism – and there has been
                         some criticism coming from Guyana’s direction
                         lately. In late March, for example, Guyana’s Vice
                         President Bharrat Jagdeo alleged that Trinidad
                         and Tobago had not done enough to protect
                         itself from over-dependence on the oil and gas   Guyanese employee of TechnipFMC, shown at event in 2019 (Photo: TechnipFMC)



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