–says country is on the right path to striking a balance with LCDS

NOTWITHSTANDING making the most out of its oil and gas industry, Guyana is still headed in the right direction as it pertains to championing environmental preservation, given the country’s focus and work on its Low Carbon Development Strategy (LCDS) 2030.

This was according to President of the Caribbean Development Bank (CDB), Dr. Hyginus ‘Gene’ Leon, in his remarks on how Guyana and the wider Caribbean is striking a balance between exploiting its natural endowments, particularly oil and gas, and its need to champion lower-carbon emissions to reduce the effects of climate change.

“The fact that [Guyana] has a low carbon [development] strategy suggests that means they are in the right direction,” Dr. Leon commented in an interview with the Guyana Chronicle on Wednesday.

He went on to say: “The issue of a balance does not have right or a wrong. You have to establish where you are, your initial conditions and where you want to go. Then you end up with how do I get from where I am to where I need to go? Where Guyana needs to go is very simple, it’s to a point where the people of Guyana will have more prosperity than they had yesterday.”

Dr. Leon noted that even though Guyana’s oil discovery comes at a time when there is a call for the scaling back of fossil fuel production, it does not negate the needs of Guyana’s economy nor erase the fact that many developed countries have already had their chance to fully exploit their resources without hindrance, and even continue to do so amidst calls for scaling back.

“It just happens that Guyana’s discovery of oil is coming at a time when the world is occupied, with saving the planet. Hundreds of years ago, there was a planet to worry about, but everybody did whatever it was in the name of growth without any regard to the planet.

“Guyana today finds itself where countries were 100 years ago with needs to develop, except that they [other countries] didn’t have constraints, but Guyana finds itself with a constraint internationally which says we need to reduce fossil fuels because of what it is doing to the planet,” Dr. Leon noted.

The oil and gas industry in Guyana, and several other oil producing nations in the Caribbean are currently driving growth in the region.

However, with Small Island Developing States (SIDS) and other low-lying countries in the Caribbean region receiving the worst impacts of climate change, questions have been raised about the production of fossil fuels by smaller countries.

With over 11 billion barrels of oil discovered so far offshore, Guyana, over the past few years, has faced questions over its aggressive oil production against the backdrop of being a champion of environmental preservation.

However, with much of the revenues garnered from its oil and gas industry being injected into the diversification of its economies, as well as being invested into the development of renewable energy sources, the country has hit back about not just its rights, but also its need to benefit from its national patrimony.

Moreover, with SIDS and low-lying countries like Guyana contributing the least to carbon emissions, while developing countries are doing little to cut back on their emissions or oil production, or supply financing to climate change affected nations, developing countries are left in a precarious position to find ways to fund much needed climate resilient infrastructure.

“That place of having a Low Carbon Strategy tells me that one of the goals Guyana is looking to achieve is a green future for the people as defined in the development strategy. It’s not just that they want the country to be prosperous, it’s that they want them to be prosperous with an environment that is still reasonably safe,” Dr. Leon said.

He added: “The government has said even if they have fossil fuel, they have embraced a low carbon strategy, which means they are not relying 100 per cent on the hydrocarbons.

“They may have to make a choice, not right or wrong, how fast they want to develop but equally how they are going to deploy those funds with what efficiency towards getting to that place.”

The fact that Guyana is a huge net carbon sink given that its forest stores 19.5 gigatonnes of carbon, even with the development of its oil and gas industry the country remains a net zero carbon contributor.

The sheer scale of Guyana’s forest has allowed the country to begin selling its carbon credits specifically designed for the voluntary and compliant carbon markets for successfully preventing forest loss and degradation – a process known as jurisdictional REDD+. In December, Guyana signed a multi-year agreement with Hess Corporation for at least US$750 million.

“In the same way, Guyana is facilitating countries through the Amazon in terms of being a carbon sink and can afford to sell carbon credits to allow others to continue to develop their oil. Guyana, therefore, equally has the right to use and do their own carbon sink usage to allow them to begin that process of growth,” Dr. Leon said.

Also speaking on this point was the CDB Director of Projects, Daniel Best, who noted that while the CDB cannot assist countries with their oil and gas sector, given its commitment to the Paris Agreement, the CDB can, however, advise countries to utilise their wealth to develop renewable energy sources is in line with the CDB’s framework.

“Utilising hydrocarbon benefits to drive the energy transition in other spaces is justified. The fact of the matter is we can use these benefits to drive the renewable energy future that we are seeking to live,” Best noted.

He went on to say: “Financing projects that are anchored in hydrocarbon production, that would not be aligned with what we are seeking to do. But at the same time what we are seeking to do within our energy sector strategy and policy is how we can support countries in utilising their natural endowments to drive the energy transition.

“Oil will create wealth in Guyana, now how can we turn that into sustainable livelihood and form an alliance on renewable energy and climate change. That is at the crux of the matter.”