WITH talk of Guyana exploring the possibility of a National Oil Company (NOC) as the nation’s global oil position climbs, the Guyana Oil & Gas Energy Chamber (GOGEC), on Wednesday, threw in its support for the move, but cautioning “careful consideration of the pros and cons need to be had before such decision is taken”.

The body’s President, Manniram Prashad is quoted in a press statement saying he was pleased that the matter was on the table.

“Going forward, GOGEC endorses the Government’s approach to ensuring maximum benefits and value are derived from future oil contracts,” the statement read, noting that it believes “Guyana can fairly obtain, at minimum, a higher royalty, and high profit share to maximise Guyana’s share from the oil and gas resources.”

This newspaper reported, recently, that, on Monday, Vice-President Bharrat Jagdeo, during a press conference, said that government was deliberating the option of passive ownership, where it owns shares in an exploration company but was not integrally involved in the exploration operations itself.

The Vice President noted, then, that the government had not yet determined whether there will be a NOC, but a continuous assessment of how that can be done was still being deliberated upon, given the various advantages and disadvantages of such a venture.

“The model that we are talking about should we go down this route is not an old-style NOC, but a more passive ownership of shares in companies in exchange for some of the offshore blocks that we have given,” Dr Jagdeo had said.

The Vice President stressed that the government’s main focus was getting the most for the country out of the oil blocks.

Earlier this year, the VP noted that several “large operators” had submitted expressions of interest to partner with the government to establish a NOC. However, the government has been keeping an eye on the public discourse on the situation and had taken note of the various negatives and positives of the multiple models that could be used to establish an NOC.

“From our own examination of the situation, we believe that having an old-style model National Oil Company at this stage could present major difficulties for the country. With net zero targets by 2050, it becomes harder to raise money globally for a National Oil Company,” the VP noted.

Net-zero refers to the balance between the amount of greenhouse gas produced and the amount removed from the atmosphere.

International scientists have reasoned that to prevent the worst climate damages, global net human-caused carbon dioxide emissions need to fall to net-zero by 2050. This is expected to be preceded by a slowdown in oil production going down to 2050.

With that being just 28 years away, this limits the number of years that Guyana has to maximise and get the most of its oil and gas sector at the soonest possible time.

The Vice President noted that the government welcomes conversations and debates about the establishment of the NOC in addition to other aspects of Guyana’s oil and gas sector and is keenly observing the valid points coming out of these discussions, notwithstanding some amount of mischief in some of the conversation.

He maintained: “I don’t mind people pointing out the negative because we have to address these issues when we make a decision. We are taking these issues seriously. But whilst we welcome that debate we’ve had a lot of crazy things being said.”