Senior Petroleum Coordinator at Guyana’s Ministry of Natural Resources, Bobby Gossai Jr., says the Local Content Bill 2021 laid in Parliament last week is a dynamic document that will be continuously updated as the oil and gas industry evolves in the South American country.
The bill represents the principal vehicle through which Guyana seeks to negotiate a tradeoff between investors engaged in the petroleum sector and Guyanese nationals and Guyanese companies operating in the industry. The document also makes provisions for the establishment of a Local Content Secretariat, which will be responsible for managing compliance with its targets.
Speaking on a recent television programme, Gossai Jr. said part of the function of the Secretariat will be to ensure that available Guyanese goods and services are matched by the demand of the operators, both offshore and onshore.
“The draft Bill specifies targets to meet by 2022, but it sets down a system for revising targets every year going forward, and an inter-agency committee will be established to guide this process,” he said.
Authorities are proposing to have local companies and citizens participate in no less than 40 critical areas in the oil sector as opposed to the previously recommended 153 categories. The government has also removed certain categories which previously attracted criticism from stakeholders. These include the provision of materials such as steel plates, flat sheers, steel pipes, and low and high voltage cables for the oil sector and the provision of Front End Engineering Design (FEED) services for onshore facilities.
“The provisions of the draft Bill are realistic, achievable and dynamic, and both Guyanese and operators will be able to assess the requirements and leverage benefits based on their interests and expectations,” Gossai Jr. said.
He also pointed out that the document enables local businesses to be involved in the entire oil and gas value chain with the ultimate goal being to retain in the local economy 21 US cents out of every US dollar spent in the oil and gas sector.
Altogether, authorities say the Bill provides for the promotion of competitiveness and the encouragement of the creation of related industries that will sustain the social and economic development of Guyana.
