As the pros and cons of having a National Oil Company (NOC) continue to be weighed, Chatham House Advisor, Valerie Marcel says that there is another option before Guyana which holds more promise. That option is the creation of a National Energy Company.
Speaking at the recently concluded Offshore Technology Conference (OTC), in Houston, Texas, Marcel said it is important for the policy leaders of the day to consider that if it creates a NOC which aims is to take on an operator role, responsible for the development of oil fields, then building the required capacity takes 15 years on average and involves substantial investments. In light of this, she said that the government should ask how many years it will have to reap the rewards of that investment before oil demand declines and the NOC struggles.
While noting that it would be quite interesting to see where Guyana falls on the question of an NOC, Marcel proposed the creation of a National Energy Company which invests in renewable energy to meet domestic needs.
The Advisor said that this company could hold minority state participation interests in the upstream, market the state’s share of oil and create joint ventures with the private sector to establish service companies for the oil sector.
As a developing country, Marcel cautioned that Guyana needs to use its mineral resources to invest in its prosperity, while avoiding the mistakes by others.
This would not be the first time Guyana has been advised by Chatham House on lending serious considerations to the implications of pursuing a NOC. In July last year, Chatham House said that NOCs can potentially transfer benefits beyond petroleum revenues to the State. It stressed however, that the net financial gain to the State depends very much on the efficiency of the NOC and the soundness of its commercial strategy. (SEE LINK FOR THE FULL STORY :https://www.guyanastandard.