Government officials and their family members will be prohibited from obtaining licences or ownership interests in petroleum exploration and related activities under the proposed 2023 draft Petroleum Activities Act.
Section 10 of the Act explicitly states that, “No government official shall, in his or her personal capacity, and in his or her name or in the name of any family member, acquire, hold or attempt to acquire or hold a licence or an interest in a licence; or a share in a body corporate which is entitled under this Act to carry on petroleum exploration, production, storage and pipeline transportation operations in Guyana”.
Drafters were keen to note that a “family member” includes individuals related through marriage, common law unions, birth, adoption, or placement for adoption.
Violation of this provision carries penalties, such as a fine of $10 million dollars and imprisonment for one year upon summary conviction. Additionally, any license, ownership interest, or shares obtained in contravention of this section will be forfeited to the state.
Persons facing charges can however present a defense in court by demonstrating that they acquired the licence, ownership interest, or shares legally and promptly sold or took necessary steps to sell them. Alternatively, they can prove that they obtained the licence, ownership interest, or shares before assuming government office. If it relates to shares, they can show that the acquisition occurred prior to the corporate entity being authorized to conduct petroleum operations in Guyana. In these cases, individuals must prove that they sold the license, ownership interest, or shares as soon as possible after assuming government office or after the corporate entity obtained authorization. Alternatively, they must demonstrate that they are actively working towards selling them.
In a progressive move to modernize the legal and regulatory framework governing Guyana’s petroleum sector, the Ministry of Natural Resources on Monday released the draft Petroleum Activities Bill 2023 for public consultation. This consultation will last for two weeks and will present an opportunity for the general public and relevant stakeholders to voice any recommendations or objections.
This bill, once passed will replace the outdated Petroleum (Exploration and Production) Act of 1986 and introduces substantial enhancements and safeguards across various aspects of the industry.