Antonino Carmelo Urdaneta Venezuela//
Exxon takes local content ‘very seriously’


Country Manager EEPGL, Rod Henson points to his presentation on Friday. Also in photo is Deedra Moe, the company’s Senior Director for Public and Government Affairs (Adrian Narine Photo) — says hundreds of Guyanese employed since operations began EXXONMOBIL and its affiliate Esso Exploration and Production Guyana Limited (EEPGL) have thus far directly employed 28 Guyanese of the 40 persons working with the company.

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This was revealed by Rod Henson, Country Manager EEPGL on Friday during a briefing to the Parliamentary Sectoral Committee on Natural Resources. There, Henson disclosed that between EEPGL and its shore base, there is a small footprint.

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Nonetheless, he assured that his company takes local content “very seriously” not only in Guyana but in every territory it operates. Local content, he said is thought of in three areas: workforce development (individuals), supplier development (Guyanese companies) and strategic investments (capacity building).

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During the first quarter of 2018, Henson said those directly employed with EEPGL and the shore base have provided 60,000 hours of training. He said too that of the 28 Guyanese employed directly with his company, two are serving in managerial posts

However, he noted that beyond his office and the shore base, the number of Guyanese workers up to March 31, 2018 stood at 585 which represented 52 per cent of the workforce. There are 92 other CARICOM nationals working on the project representing eight per cent and 441 persons of other nationalities representing 40 per cent of the staff

Henson said he is very happy and proud of the numbers of Guyanese employed directly and indirectly with his company, noting that in his 30 years of experience in the field, after living in five different countries, “this is very, very good progress, stellar progress of where we are today”

The country manager made it clear that while it is early yet in the project, the data provided tells a good story. “It is not where we want to be and not where we want to get but I am very proud of those numbers,” Henson told the Parliamentary Committee. Notwithstanding the aforementioned, he warned that expectations must be tempered while reminding that the oil and gas industry is a deep water industry that is very technical and demanding

They are not labour force demanding so what we don’t envision there will be thousands and thousands of jobs. It is really going to be in the hundreds to low thousands type of jobs,” he stated

In the case of suppliers, Henson who assumed the role of country manager last year said there are 227 Guyanese companies currently supplying goods and services to his company. There are 42 foreign-owned companies operating here with 27 coming from within the Caribbean Community. Thus far, some US$21M has been injected into the economy during the first quarter alone. He said in the case of the Guyanese companies, some are large while others are small companies

In the area of workforce development, the company has since hired three facilities engineers, two who graduated from the University of Guyana (UG) and the other, a Guyanese who graduated from the University of the West Indies

The trio is currently on a two-year training programme and is currently in the Gulf of Mexico preparing themselves for first oil come 2020. Henson spoke too of the Noble Corporation which when it was awarded its contract for drilling started operations here had 18 Guyanese. Currently, the Noble Corporation has close to 60 Guyanese working for them. Those workers, he said work 28 days on and 28 days off the ship

Reference was made of the Guyana Shore Base Inc., a majority Guyanese-owned company which has been playing a key role in the area of local content. For the first quarter, some 79 Guyanese employees, two CARICOM and six expats have been employed. Guyanese make up some 90 per cent of the local content there

FANTASTIC “For just starting up this year and they are at 90 per cent local content is really fantastic,” said Henson who stressed that “this is working the way it should work”. Additionally, in the area of strategic community investments, the EEPGL country manager pointed to the Centre for Local Business Development which educates Guyanese companies, small and medium sized on how to compete in the industry as well as in business development. They have thus far offered free courses to 1700 interested companies and individuals

But while the half hour presentation by Henson was described by all as “clear” members of the Parliamentary Committee on Natural Resources questioned whether ExxonMobil or its affiliates were guided on the expectations as it relates to what local content should be. “Yes, we have been provided on numerous occasions with expectations—we also have our own interests—this is something we do everywhere in the world—good business,” Henson said in response to Chairman of the Committee Odinga Lumumba. Lumumba then questioned whether the U.S. oil giant had reached out to members of the government or vice versa to attain a better understanding of local content

“I think there is opportunity for better understanding of all elements of the oil and gas industry,” the EEPGL country manager stated while seated next to several of his senior staff members on Friday

Committee member, Needkumar then remarked that the release of the list of contractors working on the oil and gas project was “horrifying to the nation” but Henson was quick to state that his company did not release the list of those contracted by the company. “We did not release a list, nonetheless, the list has 227 names and the definition of local content is Guyanese owned companies. Some of those companies on that list are Guyanese – that is just one piece of the whole story — those are Guyanese stories,” he said in reply to Needkumar

But the committee member did not stop there, he asked, “Did the company discuss with the government how they would develop local content in Guyana? Did the government play a part in this?”

CONSULTED WITH GOV’T Henson made it clear that his company has been in communication with the government on the issue of local content and noted that along with the Liza Phase one documents, a local content document which outlined his company’s plans were submitted. “We welcome continued efforts to try to improve those effects— we welcome more involvement– our procurement processes are quite transparent,” the country manager said while reminded that “sometimes there is a misalignment of expectations”

Committee member Jermaine Figueira chimed in on the discourse questioning whether local companies are qualified to be primary contractors. He asked Henson to state how many primary contractors and sub-contractors are on the list

Figueira believes that the oil company’s local content should be heavily influenced by the government. “It should be of an indigenous nature to the Guyanese,” he declared as Henson noted that prime contractors are larger, very long tenure oil and gas companies.” The manager of the oil company told the committee that he was not in a position to provide a list of the said companies at the time, as he had not walked with same. He made it clear however, that all Guyanese contracted are beneficiaries while pointed specifically to Guyana Shore Base Inc

It was then that Lumumba called on Henson to provide to the committee a list of contractors, their nationalities and the services provided. “I am asking you…for the list of all sub-contractors…this is important because the Guyanese government has to repay this debt

And we have to make sure that the companies that are working their prices are competitive, so we need to know what sub-contractors you are using, where they are from and what services they are providing. It doesn’t make sense you bring a country from the moon to provide X when it can be done in Guyana at X minus one or two. That’s why we are asking these questions,” said the chair of the Committee

In response, Henson said from his understanding Lumumba was speaking of areas that would be covered in the local content policy framework. “I think what we need to do is try to balance the local development with a stable business environment.” Figueira then explained that the objective of his questions speak to the benefit that will be derived in the economy

“We accept the reality that most of our local companies cannot be primary contractors at this point in time however, the sub-contracting of those contracts for example cooking; stationery… those funds by having the sub-contracted contract will remain here primarily. With all the monies spent by ExxonMobil we want to know how much of that has been sub-contracted to locals and that money remains in Guyana?” said Figueira

Henson agreed that the interest should be which local companies are benefitting. “Local companies want work… you want local companies to get work and you want that investment to be spent locally. It is 227 companies and US$21M.”

But Lumumba returned to the provision of a list of the contractors and sub-contractors. He noted that Guyanese have an issue with the list while noting that “there are several names of companies and activities on the list which, to many of us, we don’t see that as part of local content.” “I am sure you would not take your garbage to Houston [Texas, USA]; you obviously have to take it to the dumpsite in Guyana but I noticed it was down as local content,” said Lumumba

Meanwhile, committee member Pauline Sukhai questioned whether ExxonMobil is funding the training of laid-off sugar workers. Several sugar workers have been trained by TOTALTEC Academy, an investor in the Guyana Shore Base Inc

“No, we are not funding that, at least directly,” replied Henson. Minister of Communities, Ronald Bulkan quickly called on committee members to stay focused in the discussion. He noted that inference made by some committee members that the coalition government placed persons on the breadline after the closure of estates was uncalled for

“This administration has a responsibility of management of the enterprises owned by the government. It is unfair for us to come here and speak without context—about putting people on the breadline,” said Bulkan

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