-says President Ali, as draft legislation being finalised for Natural Resources Fund
IN an effort to strengthen transparency and eliminate causes of concerns, the Government of Guyana will be moving to ensure that adequate information related to Guyana’s oil revenues are released to the public. This assurance was given by President, Dr. Irfaan Ali, during a virtual press conference hosted on Monday.
“We committed during the campaign that there will be no secrecy in revenues received by the country from our natural resources, especially oil and gas, and we have stuck to that commitment,” President Ali told reporters. He said that in doing so, the People’s Progressive Party/Civic (PPP/C) government has ensured that the public is notified of all the monies deposited into the Natural Resources Fund. The oil earnings, the President related, are also gazetted. Even further, Dr. Ali said that the oil revenues will also be documented online.
“We are moving a step further in creating a balance sheet that persons can examine online and be kept abreast with revenues and expenditure,” the Head of State said.
He reasoned that the Natural Resources Fund (NRF), also a Sovereign Wealth Fund, is critical in safeguarding resources for future generation of Guyanese, President Ali said.
He noted, however, that this coincides with the fact that the country has “immediate needs” that have to be financed.
Dr. Ali affirmed that even if the government decides to dip into the Natural Resources Fund, mechanisms are in place to ensure that any and every withdrawal has to receive the requisite approval from the National Assembly.
“Any projects to be financed from these funds must be approved by the National Assembly,” President Ali stressed.
Added to that, the Head of State said that efforts are underway to craft a new legislative framework to govern the important Natural Resources Fund.
Dr. Ali said that even though the PPP/C government would have liked for the legislation to be presented to Parliament before it goes into recess, the document is still undergoing a process of finalisation. “I am aware that there are technical suggestions being transmitted to the Attorney-General, so we can finalise the legislation to take to the National Assembly,” President Ali noted.
Should all go well, the significant pieces of legislation could possibly be presented to the House by the end of this year.
Questioned about a perceived shortfall in the release of information pertaining to the NRF, President Ali asserted that every piece of information that the government has, every discussion they have had and any change in any agreement have been shared with the public.
Currently, even with oil prices on a global rise, Guyana has still been reaping the benefits of a burgeoning petroleum sector.
As a matter of fact, earlier in July, Natural Resources Minister, Vickram Bharrat, said that Guyana was expecting proceeds from its seventh oil lift, which could rake in around US$75 million.
The country’s seventh oil lift was safely and successfully completed by operator, ExxonMobil, aboard the Liza Destiny Floating Production Storage and Offloading (FPSO) vessel offshore, in June. Lifts of about one million barrels of oil are done every eight to nine days. And, with Brent crude oil, the index Guyana uses to sell its crude, at more than US$75 a barrel, Guyana could easily clear US$75 million, the highest amount garnered since the nation started trading this commodity.
Having earned over US$60 million from the sale of its sixth oil lift, and received US$13.9 million in royalties in the first quarter of this year, Guyana has in its NRF over US$344 million.
Specifically, according to the Bank of Guyana, the nation ended June with US$344,161,633 in its NRF at the U.S. Federal Reserve Bank.
Revenue garnered from the sale of the seventh oil lift could push Guyana’s total earnings to close to US$420 million. It was in early March that Guyana also benefitted directly from its petroleum sector, receiving US$61,090,968 (approximately G$13 billion) from the sale of the nation’s fifth oil lift.
Guyana sold its first one million barrels of crude on February 19, 2020, raking in nearly US$55 million. In its second million-barrel sale, the country received US$35 million, and another US$46 million as proceeds from the sale of its third million-barrel of crude, and US$49.3 million from its fourth oil lift.
It was reported in May that the country’s total revenue is expected to increase by 17 per cent, with earnings in the petroleum sector alone reaching well over US$500 million by the end of this year.