For Immediate Release to All Media Houses
Alliance For Change (AFC) Press Statements from Press Conference of April 30, 2021
Meeting with EEPGL – Khemraj Ramjattan M.P. Leader, AFC
Out of necessity, acting upon the numerous grave concerns brought to our attention by Guyanese of all walks of life, and in light of the fact that the PPP/C has been missing in action in addressing these issues, both representatives of AFC and APNU requested, and was granted an urgent meeting with Mr. Routledge, the Country Manager of ExxonMobil and his team, which was held on the 22nd of April at the Leader of the Opposition Office.
In this introductory meeting which set the stage for future meetings, we were given a briefing on the Company’s overall operations. Our Opposition team queried why production was reduced to
30,000 barrels per day; why flaring continued at high levels; the non-functioning of equipment and whether Guyanese will have to bear costs of the repairs thereof; and, what was the Company’s involvement in the gas to shore project.
We made it pellucidly clear that, consistent with our record whilst in office, the Opposition is committed to attracting foreign investments, but investors must conduct their business in a manner that is fully compliant with Guyana’s laws protecting our people’s health and safety, in consonance with strict application of environmental laws and practices, and consistent with Guyana’s benefitting maximally economically. Mr. Routledge was emphatic that these interests, namely, safety, the environment and the economy are also what the Company is tied to.
It is noteworthy to remind that during its tenure in office, the Coalition Government made arrangements for the then PPP Opposition to have routine independent meetings with EEPGL without any interference. However, no such privileges or courtesies were granted to us by the PPPC, since their assumption of office, to institutionalise such an arrangement.
Unfortunately, the PPPC has been far from meeting its obligation of being forthcoming and transparent with information concerning EEPGL’s operations, hence the necessity for the citizens turning to the APNU and AFC for help. We have been very active in Parliament, representing the people’s interest in keeping matters of Oil and Gas concerns on the front burner and coming up with ways for addressing such matters. Our Motion tabled before Parliament on the issue is intended to lay public a debate, once and for all, on this serious and harmful flaring matter which has implications for the environment.
Regrettably, the PPPC has used its power to stifle any debate thereon since its tabling months ago via a lockdown of the National Assembly. A prorogation by Covid means, it seems.
GPL- The PPP has not changed its spots – Juretha Fernandes M.P.
The Alliance For Change (AFC) notes the many disingenuous attempts by the PPP and their cronies who have been appointed as Directors of State Boards and other high offices to wiggle their way out and put a spin on revelations of malfeasance.
Over at GuyOil, the nation was scandalized when recordings were made public of Directors and management staff openly soliciting bribes and kickbacks in return for approving the purchase of fuel. The very PPP that clamored for criminal charges to be brought against officials of the coalition and ordinary citizens on the most frivolous of accusation, is now letting their corrupt cronies off with a slight slap on the wrist.
The AFC believes and demands a full and unfettered investigation by the Guyana Police Force into these reports and that criminal charges be brought against those involved. It is outrageous that the police have not been called in. Further, we believe that the entire Board should be disbanded as there is evidence of attempts to breech the Company’s procurement policy and other members of the Board were aware of this.
At the Guyana Power and Light (GPL) it may be that reports in the public domain of Directors about to give themselves a twelve percent increase in remuneration that put an end to that plan. The futile attempt by the Corporation to excuse the purchase of two new luxury vehicles purportedly for use by Divisional Directors of GPL is callous and shows the contempt the Board and the CEO of GPL have for the ordinary workers of the company and the people of Guyana.
At a time when GPL is making excuses to pay workers a salary increase, the company is buying brand new vehicles for its senior management. Such decision making practices show the lopsided interest the present corps of executives have and is reminiscent of pre 2015. We remind these executives that it is primarily the ordinary workers who keep power generation going and it is the ordinary workers who collect revenue for GPL.
On one hand GPL bosses and the PPP are decrying the high cost of fuel but on the other hand GPL which falls under the purview of the Prime Minister is purchasing new vehicles. Clearly priorities need to be realigned at GPL. There are also questions of impropriety as one of the Directors is a manager at the company that
bid to provide the vehicles. This is a clear case of conflict of interest and shows the total disregard the Board has for corporate good governance.
What the nation is witnessing with these state corporations; GPL and Guyoil, is the old PPP. Less than one year in office and it is back to their old habits where malfeasance is an acceptable Modus Operandi and the proverbial fat hogs are allowed to gorge themselves at the trough of the public purse.
GPL Procurement Policies – David Patterson, M.P. General Secretary, AFC
The AFC notes the ongoing corruption scandal involving the procurement of fuel by Guyoil purportedly on behalf of GPL, with grave concern and calls for an investigation to be launched into GPL’s new procurement practices.
The claim by the Guyoil Director that he met with the Chairman of GPL over breakfast at the Princess Hotel, if true, is both troubling and an act of blatant corruption. Procurement matters for public entities is not a matter to be discussed and agreed by Board Members. Prior to August 2020, GPL procured fuel via long term contracts after a public procurement process. It was the policy under the Coalition administration that fuel supplied to GPL was to be done under an open and transparent system. Eligible bidders were invited to submit bids for a long-term contract based on the specifications, cost, and transportation for fuel to GPL. Bidders had to confirm that they can deliver the required amounts, from an approved refinery, on a fixed schedule (usually every 10 days) before being awarded the Contract.
During the tenure of the Coalition Government, dozens of unsolicited bids were received for the supply of fuel to this entity. All such offers were declined since the regular, confirmed supply of fuel to GPL is critical to the smooth operations of the organization. The practice of purchasing from middlemen was completely discontinued from 2015, since it was deemed a recipe for inefficiency and corruption as has been uncovered with the most recent scandal.
On another related procurement award by GPL, it has been noted that members of the government have made claims that GPL has not executed any maintenance on their transmission lines for the last four years. This is a complete falsehood and is a disservice to the members of the company’s Transmission and Distribution unit (T&D), one of the hardest working teams in the company. This unit has been working under the harshest conditions within some of the most challenging terrain and have been providing yeoman service which enabled the company to reduce their line losses by five (5%) of the last five years. Their works resulted in saving GPL over $400M annually. The AFC calls on GPL to correct this injustice to the hardworking employees of the company.
For the records, the T&D team, over the last five years has been conducting maintenance exercises on almost all the major transmission lines in the Demerara Berbice Interconnected System (DBIS), coupled with regular maintenance to our distribution network.
Due to the efforts of the T&D teams, GPL was able to progressively reduce the frequency and duration of blackouts between 2015 and early 2020 – something that has clearly regressed under the PPP administration.
It is suspected that the background to these untruthful claims, is to justify GPL entering into costly contracts with overseas contractors with no evidence of public procurement procedures being followed thus bypassing their inhouse units and local contractors who are fully capable of executing these maintenance programs – another example of “money for the boys”.
AFC calls for a full investigation into the new procurement practices of GPL and considers Board members liable for any and all uninvestigated and unchallenged diversions from applicable policies and procedures of procurement.
Wales Gas to Shore Project -David Patterson, M.P. General Secretary, AFC
The AFC notes with satisfaction that the PPP has acknowledged the depth and quality of the studies undertaken during the Coalition’s stewardship of the Oil and Gas sector and had to begrudgingly confess that they have based their decision to bring gas to shore, solely on the studies undertaken during the coalition administration. However, we noted that they have deliberately only highlighted the sections of these studies that lent support to their unilaterally selected site, while ignoring other relevant and critical aspects of these studies. Irrespective of the basis, this decision to locate the gas site at Wales, is premature, incomplete, and requires additional detailed studies.
Importantly, none of the studies commissioned under the coalition administration recommends the site selected by the PPP, nor even supports the costs the PPP are now associating with the gas to shore project. As a matter of fact, it is important to note that Wales was considered among 10 sites but rejected in the studies. A Value for Money audit should be undertaken to determine the viability of the proposed costs of constructing an onshore pipeline for US$80M – US$100M as opposed to selecting a site closer to the coastline, and using these sums to do site clearance, protection, and filling. Conservative estimates indicate that such an approach will be far more cost effective.
The PPP claims that UREA will be a byproduct at the stated volume of gas (50mfd). This claim is not supported by any of the studies. In fact, the studies state that for UREA production, a minimum excess amount gas of 74mfd will be required. The projected excess amount of gas after utilization for power production is calculated at 15mfd – which makes it uneconomical and impracticable – yet the PPP has used this promise as one of their justifications for moving ahead with the gas to shore project. We reiterate that more studies are needed on this project concept!
The PPP has presented a proposal to install a Liquefied Natural Gas (LNG) plant which it is claimed will produce approximately 3,400 barrels per day. Noting that in 2020, Guyana’s total Liquefied Petroleum Gas (LPG) usage was approximately only 2,000 barrels per day, they have decided on a plant without the provision of any plans for utilization of the excess volumes. The studies clearly state that exporting this small amount is not economically viable. Under the Coalition government, studies had commenced to assess the possibilities of powering our revised public transportation system with excess gas. Unless such studies are completed, any decisions on the gas to shore project remain premature and incomplete.
The projected costs of US$900M is exclusive of costs for power generating plants as well as transmission of the power to GPL power distribution stations. The studies utilized by the PPP listed the costs for the power plants and transmission lines to be US$240M and US$85M respectively – which would make the total project cost approximately – US$1.225B. This astonishing sum will be added to Exxon’s cost recovery total during the next four years, thus further delaying the opportunity for our country’s citizens to benefit from our natural resources.
What should be of great interest to the Guyanese public, is that using these same studies, the Coalition government planned to deliver a project that produced 188MW of power plus 2,200 barrels of LNG daily for a price tag of under US$600M – half the amount that the PPP is demanding, and they have shown no additional value as a justification for these huge increases in expenditure – other than the typical “Money for the Boys”.
Further, based on the studies, the quantity of gas (50mfd) being proposed to be utilized by the PPP will only be guaranteed available for 11 years, while the 30mfd will be fully available for 18 years. The Coalition based our decision to utilize the lower quantity of 30mfd, not only because of cost but more so, because of our commitment to transition the country to one hundred percent renewables by 2040. The Power Generation Study completed by the Coalition, provided a roadmap to this transition, with the introduction of a mid-scale hydro plant project by 2030. The decision to expend an additional US$600M at the expense of six years guaranteed gas supply is quite frankly – “voodoo economics”.
The AFC supports a gas to shore project, however the project proposed by the PPP is not economically or environmentally sound or sustainable. We therefore demand that further detailed studies be conducted before the country is saddled with its largest ever PPP white elephant.