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Guyana discovers massive oil and with it, uncovers huge challenges

In Business, Video by CCTV America

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Goto Source Article

Guyana’s recent oil strike can mean big business or big problems for the coastal nation.

Detected Closed Captioning: [Music] It’s Carnival In Guyana This often-overlooked Corner Of South America Is Celebrating The Annual Mash Romani As It’s Called Here Also Commemorates The Birth Of The Republic But This Year Maybe There’s A reason For A Few Extra Smiles Because soon This Small Nation May Become A little Less For Gotten Out To See What’s been Dubbed A Mother Lode Of Oil Has Been Discovered It’s Worth Seventy Billion Dollars At Current Market Prices a Massive Windfall For A Country Which has Never Previously Produced Oil And it’s Home To Just Eight Hundred Thousand People A Third Of Whom Live Under The Poverty Line But With This Newfound Wealth Will Come responsibility Much Of That Rests On The Shoulders Of The President David Granger and His Senior Advisors History Will Judge Whether They Handle This Gift Well or Not Will This Nation Prosper Or Might It Suffer The So Called Resource Curse whereby The Spoils Of Natural Resources feed Corruption Inefficiency And Ruin We Went To Gai Anna’s Natural Resources Ministry For Decades Not A Great Deal Has Gone On Here Guyana Currently Produces Modest Amounts Of Bauxite Used To Make Aluminium And Gold But Now Raphael Trotman The Minister Of Natural Resources Is The Man Everyone Wants To Talk To So How Much Oil Is Guyana Found It’s Between A Range of His Hundred Million To One Point Four Billion Mar So It’s Quite A Lot Well That’s More Than Quite A Lot For A Small country Like IANA That’s Surely A Transformation It Is It Is So What What are You Going To Do With This Well We’re In The Process Of Preparing For What Is Obviously Going To Get Windfall But With wind Falls Of Course There Are Dark Clouds That Can Come With Those And We’ve Been In Them Studying This Whole Phenomenon Of The Resource Curse And Of Course Looking At Issues Of Transparency Corruption What Projects We’ll Be Spending On So Essentially We Have crafted A Sovereign Wealth Fund Bill Which We Hope To Reveal To The Public soon And Take The Parliament Later And We Are Going To Identify What We Think are National Projects That We Can Spend Money On In Addition Of Course To Saving So The Fund Will Manage The Oil Revenue And We Are Ensuring That We Do Have Generational Transfer There’s Money To be Spent By Our Grandchildren And Great-grandchildren And Their Offspring That Will Have Some Transformational Projects That Can Keep The Country Going Long After The Last Drop Of Oil Pubs And So The Find Worth Fifteen Times Guy Anna’s Current GDP Was Made A Hundred And Twenty Miles Offshore By A Consortium Of international Oil Companies Led By Exxon From The United States As Well As Hess also From The US And The China National Offshore Oil Corporation This Was The President Visiting That Visa Site Where The First Significant Find Was Made already It’s Been Agreed That Profits Will Be Shared 5050 Between The Oil companies And Guyana we Are On A Bit Of An Accelerated program And So We’re Hoping That By 2022 2021 We Can Have First Phase Of The Development Of The Lisa Well That Means pumping You Know Between 50 To 100 thousand Barrels Per Day And As Things Progress We Can Move Upwards From There There Are Of Course Various Hurdles To Be Overcome Before Those Hoped For Transformational Revenues Start Actually arriving Here First Of All There’s The Question Of Whose Oil This Really Is [Applause] neighboring Venezuela Has A long-standing Claim Against Guyana it Argues 40% Of Guyana ‘s Entire Territory Is In Fact Rightfully Venezuelan If That Disputed Area Is Extended Out To sea As Venezuela Says It Should Be It Includes One Of The Discovery Areas The Whole Boundary Dispute Looks Set To Go To The International Court Of Justice Next Year Minister Trotman Says The Controversy Will Not Hold Guyana Back our Primary And Only Focus Is Getting The Resource Out Of Well In This Case The Bottom Of The Ocean We Don’t Believe that Where These Are Located In The First Instance That There’s Any Claim whatsoever And Secondly A Sort Of Wide Acclaim We Don’t Believe It Has Any Merit But Even Putting That Dispute Aside Some Are Suggesting That This Nation With Its zero Experience Of Oil Exploration And Production May Be Rushing Too Fast Into This Nigel Hughes A Lawyer And Representative Of Guyanese Businesses And Civil Society Is Worried That Ordinary Guyanese People Don’t Realize What’s About To Happen To Their Country I Don’t Think There’s An Appreciation even At A Rudimentary Level Of What I’ll Will Mean And The Cash Flows From It As A Citizen I Have Concerns About Many Things One Of Them Of Course Is The level Of Disclosure I Don’t Think There has Been As Full Disclosure As They Ought To Be By The Government Certainly I Know We Don’t Have The Institutional framework I Don’t See A Roll Out Of A Public Education Program About What Oil Means One Of The Concerns We Have Of course Is That This Talk About Severing Sovereign Wealth Funds We Don’t Know How They’re Gonna Be Established When What Type One Of Hughes’s Main Concerns Is Connected With The Unusual Politics Of this Country Guyana A Former British Colony Has Been Independent Since 1970 its Population Is Around 40% People Of East Indian Origin And Around 1/3 Of African Descent The Two Ethnicities Mix Without Much Problem Most Of The Time Except During Elections When Still The majority Of People Vote According To their Race That Has Led To A Particularly Contentious Political system With The Pendulum In Successive Governments Swinging From One Ethnic group To Another And That Undermines long-term Planning Of Just The Sort Needed Now The Mandates Of The Political cycle For Example Especially In Ghana Where We Racially Divided Every Five Years So Our Decision-making Gets Driven By Five Years But Worse Than That Because We Have Had A Long History Of Of The Vision We’re Less Likely To Reach Consensus Because Somebody May See Short Times Just Short Term Strategic Gain Without Paying Attention To The Long-term Needs Of The Country And That is A Problem Minister Trotman Pledges His Government Is Taking A Long-term View We Take The view That The Resource Belongs To Every Single Guyanese And The Government Is Simply Destroyed The Custodian On Behalf Of Every Guy Needs And Certainly Other Government We Will Be Consulted With And Briefing The Opposition And All Stakeholders To Ensure That There Is there Is Inclusion In Decision-making That Everyone Has Kept Up-to-date And that We All Can Benefit And This Is Why The Law Has Already Been Written To ensure That There’s Going To Be Benefit Sharing To All Ten Regions Of Guyana And That Every Citizen Shall Be Entitled To An Equal Part Or Share In The Revenue There Is Another Pressing Concern And that Involves Preserving The Environment of This Under Visited Under Populated Nation 85% Of Guyana Is Spectacular Largely Unspoiled Rainforest [Music] it’s Coasts Naturally Protected By Mangroves Is The Setting For Exceptionally Rich Biodiversity But It Is Vulnerable If There Was An Accident And An Oil Spill In The Exploration Area this Is Where The Oil Would Come A Net Our Tune From The Guyana Marine Conservation Society Is Worried That The oil That Might Make This Country Rich brings Danger Too Because We Have Such A Pristine Coastal Area 421 Kilometers Long But A Lot Of Vegetation Such As Mangroves We Have A Huge Part Of Our Coastline Region One especially All Intact Mature Mangrove Forests In Terms Of The Mangroves You Also Have A Very Rich Biodiversity The Mangrove Serves As Home To Birds Of All Kinds There Are Fishery Nurseries So Yes in Terms Of A Spill It Will Impact Our Biodiversity in A Big Way Generally We Have Never Had Much Research Done In Our Marine Environment So We Know A Little Very Little Of What Exists Out There Other than The Fish That We Eat Or The Sea Turtles That We’ve Been Protecting For 40 Years So It’s Hard To Sort Of Um You know Know What Could Be Impacted If You Don’t Know What Exists There That Is Also Compounded By The Fact That Our Regulatory Agencies Aren’t Very Strong in Terms Of Marine Regulation Oversight At The Moment And That Capacity Needs To Be A Lot Stronger And Exists Presently So With The Oil Industry Being New And Emerging Those Would Be My First Two Concerns We Went To The Area That The Government Says Could See The Most Direct Benefit From The Oil Find Crab Island Once Fought Over By British And Dutch Settlers Now Nothing Much Happens Here even The Crabs Have Gone Say The Locals it’s Been Selected For A Possible Five Hundred Million Dollars Of Investment and Construction Of An Oil Service center Backing Up The Operation Now To See Its Main Advantage Is It Is A Safe Deepwater Harbour Amongst The Small Fishing Community Here We Didn’t Find Much Euphoria But Plenty Of Cynicism So You’re Worried About The Oil Yes Very Worried About That Because We Won’t Get A Catch Anymore Why Not I Will Float On The Sea Maybe It Will Leak Start Spreading The Sea And Then You Can’t Get A Catch Fish Will P Do Because We Go There And Fishing Right Actually Where The Islands Follow Nice Slow Down The Fishing But It May Change The Country A Lot Then The Government Have To Pay Me Off Have To Pay You Off here Yeah And Give You A Job For The I Company It Will Make The Culture It’s not The People Alopecia Monument Define A Job Valley fishermen In Guyana Who What When Why Company We Think The Better So No Yeah No I Get Job Because Then Free Stop Catch Do You Know Again Often Does elbows Peter Mac About Does Not Do On the Way Back To Georgetown We Were Reminded Just How Weak The infrastructure Of This Country Is Only One Tenth Of Its Roads Are Currently Paved In The Capital We Came Across A Mix Of High Expectations For Better Times And Concern And You Think It’s going To Work You Think It Will Change This Country We’re Hoping That It Does Yeah Put Us Out There Yeah For Me I Think It’s A Big Plaza Diana Because It Would Create The Necessary Income That we Need To Push This Economy Forward And It Will Create Jobs For Lots Of People Hopefully I Lose Money By The You G20 Country Gonna Be Very Good We’ve Reported On In The Pocket That Would Be very Bad Because You’re Still The One We I Hope You’re Not Deluding Ourselves That We Could Actually Get It Right From or Early Up So This Is Why I Think We need A Much More Stronger You Know Civil Society Engagement Stronger Engagement With Our Or Administration Whichever One It May Be Airtight Mechanisms With People Who Have High Integrity And A Knowledge And Experience To Develop policy That The Nation Benefits From Not One Particular Group Or The Other You Know And This Is Where We Need To Start thinking About Guyanese And Not You Know a Long At Nick Or A Political You Know alignments Minister Trotman Says He Has No Problem With The Skeptics But He Says Make No Mistake This Country Is On The brink Of Change We’re Not Here To Say Look Who We Are Now I Think We are Prepared To See However That Our time Has Come And We Are Very Grateful And We Have Had Many Years Of Sacrifice You’ve Just Celebrated In Fact Fifty Years Of Independence As From Colonialism It Is A Necessary Step In our Future Development As A Young Nation a Young Nation It Is Entering A New Era

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Geographic Location References for this Article Could Not Be Accurately Determined. Here is our best guess.
Name: Guiana
Latitude: 4
Longitude: -60