Geopolitics of oil and water in Guyana

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Dear Editor

In a previous article  I discussed Guyana’s geography and environmental conditions against the backdrop of South America’s lone English-speaking petro state. I turn attention now to the nature and impact of the flooding and offer a few prescriptions to address the challenge.

Water, Water Everywhere

Guyana’s current aqua condition calls to mind the memorable line in Samuel Taylor Coleridge’s classic poem, The Rime of the Ancient Mariner: “Water, water, everywhere.” Heavy rains are expected in Guyana at this time of the year, part of the country’s May-June rainy season. Indeed, the Agriculture Ministry’s Hydrometeorological Service published its May-June-July 2021 outlook on April 29, predicting “slightly higher chance for wetter than usual conditions in Regions 1, 2, 3, 4, 5, 7, 8, 10, and norther 6.” The forecast also anticipated “wet as usual conditions” for Regions 9 and southern Region 6. Still, no one anticipated the ferocity of the downfall and the severity of the flooding, which portend danger on many fronts.

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The rainfall has been incessant and the flooding catastrophic, inundating the entire country and severely impacting seven of the country’s 10 administrative regions:  1, 2, 3, 6, 7, 9, and 10. Thankfully, Region 4, where the capital is located, has been spared the heavy flooding. For the month of May the rainfall was recorded at 607.7 millimeters (23.9 inches), the second highest deluge since 1981. Some communities, including highland areas that have never experienced flooding, now are contending with it. President Mohamed Irfaan Ali has called the situation the worst natural disaster in the country’s history. Speaking at the commissioning of the Saipem Guyana Offshore Construction Facility on June 5, he called attention to some of the human and social-economic toll of the disaster. Later, on June 10, he issued a disaster declaration, which triggered activation of the National Emergency Operating Center.

It is too early to calculate the disaster’s full social and economic costs. Still, its wide-raging impact already is evident. Almost 30,000 households in at least 300 communities have been displaced, some surviving in less-than-optimal shelter conditions. Homes, roads, and bridges have been washed away, and mudslides have been creating havoc in some mountainous areas. Food prices have increased due to shortages, and access to potable drinking water has been disrupted in some places. Hundreds of farms have been destroyed, and in Region 8 (Potaro-Siparuni) alone, an estimated 360 gold mining operations have been affected.

Thankfully, no deaths have been attributed to the flooding, but there are credible concerns about malaria and water borne diseases and a spread of dengue fever that already is problematic in some interior areas. Moreover, the already serious COVID-19 pandemic situation risks becoming worse because testing and vaccination campaigns have been interrupted in some parts of the country.

The Civil Defense Commission has been reaching frenetically across the country to provide food and sanitary and medical relief, with considerable support from the private sector, including oil companies, civic organizations, and Guyanese in the diaspora. On June 14 the National Assembly approved a supplementary budget of G$10 billion (US$47.5 million) to rebuild and repair roads and bridges, and to aid farmers and miners whose lives and livelihoods have been impacted, among other things.

In all likelihood, the supplementary allocation will not suffice to meet the various needs once the disaster impact assessment is undertaken. That process will commence on June 23. Undoubtedly, Guyana will need both short- and long-term international assistance in several areas to address the multiplicity of current challenges and those on the horizon. Indeed, Trinidad and Tobago, the United States, the European Union, Japan, the Barbados-based Caribbean Disaster Emergency Management Agency, the Pan American Health Organization, and the Regional Security System are among nations and entities that already have extended helping hands. No doubt, other offers will be forthcoming.

Facing and Fixing 

Even before the flood waters recede, the gravity of the situation and the significant implications involved warrant candid reflection on contributing factors and how some of them might be prevented or mitigated in the future. As we inferred in the first article, torrential downpours are a cardinal feature of this Amazonian country and cannot be avoided. In this respect, geography and the environment are not the only relevant factors. Over the years the central government and various local government units have been delinquent in relation to adequate maintenance of the Sea Wall and the scores of kokers and water pumps that dot communities along the coasts and banks particularly of the Essequibo, Demerara, and Berbice rivers.

Some of the mangrove forests also have suffered neglect, and worse. One case last month that highlights some of the tensions between preserving the environment and accommodating oil industry needs was the removal of mangroves from the Versailles/Malgre Tout sea defense on the West Bank of the Demerara River by TriStar Incorporated, as part of its preparation to build a 66-acre shore base facility, a wharf, and a jetty. This action endangered the environmental security of thousands of residents in Pouderoyen, Goed Fortuin, Phoenix Park, Plantain Walk, Vreed-en-Hoop, and other villages. The National Agricultural Research and Extension Institute explains that mangroves are key to the country’s natural sea defense, providing about 5 to 10 times more carbon storage than terrestrial forests.

Thankfully, criticism and activism by community residents, and environmental and civil society activists helped save the day. Earlier this month, TriStar began stockpiling nearly 20,000 tonnes of steel sheet piles for revetment works at the facility. Moreover, Natural Resources Minister Vickram Bharrat took the opportunity of his June 6 World Environment Day message to announce resumption of the Guyana Mangrove Restoration Project, initially funded by the European Union to plant, restore, and protect mangrove forests. Individual and corporate citizens also bear some responsibility for contributing to the conditions that lead to flooding, by dumping garbage into canals, trenches, and koker areas, thereby impeding the efficient flow of rainwater.

The flooding in Guyana is expected to have minimal impact on offshore oil exploration and extraction operations, although it will cause disruptions in onshore business, training, and governmental engagements. The current rainy season is not over, though. As a matter of fact, heavy downpours through August have been predicted. Moreover, the second rainy season—December through January—cometh.  So, the country will have to endure heavy deluges and flooding later this year, and beyond. Interestingly—and thankfully—Guyana has been benefiting from an environmental phenomenon originating in geographically far off Africa: gusts of Saharan dust have been suppressing some of the rainfall.

Environmental Security Investments

Guyana’s current flood travails have the makings of an environmental security challenge, with environmental security defined as a situation where environmental-related or caused problems severely compromise the ability of state power holders to exercise normal political, economic, military authority, which, in turn, undermines the state’s internal governance or external sovereignty. Needless to say, prolonged flooding foreshadows health security challenges, especially given the country’s severely challenged health care operations, not to mention economic and law-enforcement security consequences.

Thus, Facing and Fixing must be done both with a view to building back better and in the context of an Environmental Security Infrastructure Investment Plan. Such a plan can have two components: a short-term one, and a long-term, transformational, one. Maintenance of the Sea Wall, clearance, revetment, and maintenance of canals, and repair/replacement and maintenance of water pumps would be key aspects of the first component. Restoration and maintenance of mangrove forests and the rehabilitation and maintenance of the Sea Wall are key aspects of the second component. Yet, there is an elephant in the room in relation to it: the relocation of the capital city from the low-lying coast to higher ground. This is a sine qua non for the country’s long term stability and security.

Guyana currently has a Natural Resources Fund with some US$300 million earning interest in the Federal Reserve Bank in New York, deposited there in keeping with legislation adopted during the David Granger presidency. Earlier this year, on April 28 to be exact, President Ali announced his government’s position regarding the funds: “We have a number of things that we have to do in terms of setting up the Petroleum Commission. We have to also look at the legislation for the Sovereign Wealth Fund. Those are things that we have to do but at this moment, we are not looking at the oil revenue to meet government expenditure.”

However, the current situation has created a fierce urgency of now, which requires some rethinking here, either to expedite action on the Petroleum Commission and the Sovereign Wealth Fund and then access the account, or secure legislative approval to tap into the Fund now for specific environmental investments. The investments could be underwritten by a tripartite package involving funds from the Sovereign Wealth Fund, loans against current oil savings and future earnings, with consideration paid to the country’s current debt burden and the possible inflationary effects of government spending, and grants from foreign sources.

External assistance surely is necessary to help Guyana meet its extant environmental security challenges. Yet, it cannot rely mostly on external assistance to fund its environmental security infrastructure investments; it must put some financial “skin in the game,” which means using some of the revenue from Mother Nature’s oil blessings of this Amazonian Land of Many Waters.

Regards
Professor Ivelaw Griffith



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