Jagdeo puts oil traders on notice

Leader of the People’s Progressive Party/ Civic (PPP/C), Bharrat Jagdeo, is sounding a warning to all of the oil traders who are vying to market Guyana’s crude.

The Opposition Leader was keen to highlight that sanctions loom for those oil companies and/or traders who are forming ties with an “illegal” government.
Jagdeo was alluding to the 19 shortlisted oil traders who have been selected by the Department of Energy (DoE) to market Guyana’s oil from the Liza One Destiny Floating Production and Storing (FPSO) vessel, the first oil production ship offshore of Guyana.

Kaieteur News, in a previous report, had disclosed that 15 out of the 19 shortlisted companies have been linked to scandals, bribery and widespread corruption..
These well-documented malpractices, which have resulted in convictions and fines, have ensnared senior executives of these oil companies and traders, while others are still under investigation.
Public documents show for example that three of the world’s largest commodities trading firms – Vitol SA, Glencore PLC and Mercuria Energy Group – have used intermediaries to funnel over US$31 million in bribes to corrupt Petrobras employees.

This was done in order to win massive contracts, along with acquiring other benefits, and resulted in one of the largest corruption scandals in recent history.
Dubbed ‘Operation Car Wash’ affair, the fallouts saw hundreds of indictments, and over a hundred corruption convictions including that of former President of Brazil, Luis Inacio ‘Lula’ Da Silva.
Sharing his perspective on the matter, Jagdeo told this publication on Friday: “They (oil traders) should avoid forming ties with any government that is attempting to steal an election, and that could very well mean sanctions, should they persist.”

He continued: “To move ahead at this point in time when a new government has not yet been sworn in is callous, and I hope that the companies that are interested would also understand that. While we want a long-term relationship with everyone, the timing is very bad. It would not be seen as transparent.”
Jagdeo is firm of the view that now is certainly not the ideal time to be signing onto international contracts, especially considering the impasse the country has been caught in for the past 117 days due to unfortunate events that stemmed from March 2nd General and Regional Elections.
Many transparency advocates have also expressed reservations on this matter given the corrupt past of many of these companies and traders.

In their view, no agreements should be signed as they can provide fertile grounds for corruption.
Speaking on this matter was PPP/C member and petroleum academic, Charles Ramson Jnr.
The attorney-at-law was keen to note that all the companies seeking to market Guyana’s oil should lend serious consideration to the authority of the administration to even enter into such contracts at this point. His comment was also hinged on the fact that it was President David Granger who, some months ago, said that his government would not enter into any new contracts.
Further to this, Ramson said there is no immediate need to run to market at this point especially when one considers that prices are at its lowest.

“So there are several elements to be considered, whether they have the authority to be engaging companies in this manner, and in my opinion, they don’t. And they need to be concerned about what can happen if there is a new government.”
Nonetheless, the 19 shortlisted companies will progress at the next phase of the procurement process and exclusively and at the same time, receive the Request for Proposal (RFP).