Brazil’s state-owned Petrobras recently handed over a strategic oil and gas plan to Guyana’s government and also signaled its interest to operate in Guyana’s waters, specifically the ultra-deep block called Area C. But Oil and Gas Consultant Dr. Jan Mangal is sounding all alarm bells when it comes to this firm whose past, he says, is “very checkered”.
Research conducted by Guyana Standard shows that, in March 2014, an investigation by the Brazilian authorities exposed a number of politicians and executives at Petrobras who accepted bribes from construction firms in return for awarding contracts at inflated prices. The investigation resulted in over 90 persons being imprisoned.
Considering this, Dr. Mangal said it becomes even more imperative that Guyana runs its oil industry transparently. He also stressed that there should be no secret deals with Petrobras or anyone.
Dr. Mangal said, “When Guyana is ready to award its next oil block, it must be handled transparently via auction and, if Petrobras succeeds in an open auction, then great. But I doubt Petrobras can succeed if there is a leveled playing field because they are not known in the industry to be a first notch operator. If they want to farm into an arrangement then good but they are unlikely to be good as the lead operator.”
Further to this, the Oil and Gas Consultant said that Guyana’s politicians need to stop being so easily impressed with companies that come with plans for the sector.
He said, “And this touches on a fundamental problem with governments in Guyana. You will see many instances where the first foreigner who comes along with a PowerPoint presentation in hand is hailed by the government as the answer.”
Dr. Mangal said that the government is suppose to do its own homework, do research on companies to find those that are best suited to help with the national oil and gas plan, and then solicit proposals from the companies. He emphasised that a competent government does not sit and wait for whoever comes along.