Govt keeping close watch on oil firms’ compliance with local content

The content originally appeared on: INews Guyana
Welding onboard the Liza Destiny floating production storage and offloading (FPSO) – Guyana’s first oil development

When the Local Content Act was passed last year, Section 12 had required companies in the extractive industry to submit local content reports every six months to ensure they were complying with the Act. The Government, it turns out, is keeping a close eye on these reports.

In a recent interview with this publication, Natural Resources Minister Vickram Bharrat made it clear that these reports and all other metrics used to measure local content compliance are being monitored by the Local Content Secretariat, which now occupies the former offices of the Guyana Rice Development Board (GRDB).

“We have the Secretariat established. It’s at Cowan Street, where the old GRDB building used to be. So, it is housed there, an annex to the Ministry, headed by Martin Pertab, the Local Content Director.

“What we have done over the last couple months since the legislation was passed and assented to, is we would have reached out to almost all the licensed contractors and we’re even trying to go beyond that in terms of preparing their master and annual plans,” Minister Bharrat explained.

According to Section 12 of the Act, “a contractor, sub-contractor or licensee shall provide a local content report to the Secretariat, within 30 days after the end of each half-calendar year, outlining its compliance with the approved minimum local content levels.”

According to Bharrat, these local content plans would contain details of opportunities for Guyanese to benefit from. Another observation made by the Minister is that many local companies were already involved in supplying goods and services to the oil and gas companies. According to him, they have been reaching out to these companies to ensure they are in compliance.

“On the other side of the registration, many companies and individuals have started to visit the office to do the physical registration. Because that is an option too. What we are doing now, and it’s in the final testing phase, is the online portal to register. So, even if you’re in Berbice, you don’t have to travel to Georgetown to register. Or any other part of Guyana.

“So, that portal will be up soon. It is in the final testing phases. There’s a bit of tweaking to be done. We’ll put that live very soon so people could register, either for employment or for the provision of goods and services. So, that’s where we are right now in terms of the implementation of the local content legislation,” Minister Bharrat said.

According to Bharrat, about 50 persons have registered for the provision of goods and services, as well as employment. He noted that the Centre for Local Business Development (CLBD) has been working with the Secretariat to increase this number.

As of last year, it had been reported that the CLBD had more than 2700 local businesses registered in its database. The CLDB was set up in 2017 by ExxonMobil, in collaboration with DAI Global, LLC, to assist small and medium-sized local businesses to build their capacity and their ability to compete to offer services in the oil and gas sector and other industries.

When it was set up, the Centre was expected to focus on developing local vendors that serve key sectors of the oil and gas industry, including areas such as safety equipment, marine operations, offshore supply and civil construction. It was also supposed to provide mentoring, coaching, and access to financial support.

While Bharrat stressed that persons registered with the CLBD were not precluded from plying their trade in the oil and gas sector, it is also encouraged that those persons register with the Secretariat as well.

Section Six of the Local Content Act requires the Secretariat to develop and maintain Local Content Registers, which will contain the particulars of “(a) Guyanese nationals for employment and (b) Guyanese nationals and Guyanese companies from which goods and services may be procured”.

Guyanese nationals, it is noted, may apply for and be issued with a certificate of registration from the Secretariat, which can be renewed annually. Meanwhile, Section 8 states that “a Guyanese national or Guyanese company who is not registered on the Local Content Register shall not be measured for the purpose of compliance with the minimum local content levels as set out in the first schedule”.