Local Content Act not a hindrance to foreign investors – Natural Resources Minister

Now that the Local Content Bill has been made law, Minister of Natural Resources Vickram Bharrat has affirmed that the regulation does not seek to be a hindrance to foreign investors and/ or companies.

During an interview with Ghanaian radio station Asaase 99.5FM Monday evening, Minister Bharrat said Guyana’s local content legislation was not created to disincentivise foreign investments or the private sector. In fact, he said it was designed to create opportunities for the local private sector.

Minister of Natural Resources, Vickram Bharrat.

“It is not in anyway a hindrance to foreign investors, to the international oil companies, contractors or sub-contractors,” Minister Bharrat highlighted.   

The Act assented to by His Excellency, Dr. Mohamed Irfaan Ali on December 31, 2021, provides for the implementation of local content obligations on persons engaged in petroleum operations or related activities in the petroleum sector; prioritises Guyanese nationals and companies in the procurement of goods and services and enables local capacity development.

The first schedule of the Act ring-fences 40 categories-sectors and sub-sectors for Guyanese participation via the supply of goods and the provision of services which include: food supply, rental of office space, accommodation, insurance, accounting and legal services.

“We are saying is that if you come and invest in Guyana then our local people must benefit from the sector in the provision of services, direct employment. We believe that we can offer a good service and that we should benefit from those opportunities that will arise from the oil and gas sector.”

He noted that in order to enjoy the benefits of local content, building local capacity must be a priority of the government.

“If we want our people to work in the oil field, the oil rigs offshore Guyana then they must be trained. This is another area that we are collaborating with Ghana on – in capacity building and training. We have a working agreement with Ghana and we will receive assistance from your country in terms of building capacity in our human resources.”

Importantly, Guyana and Ghana have inked a Memorandum of Understanding (MoU) to foster greater petroleum relations between the two countries. This agreement was signed on Tuesday by Minister Bharrat and Ghana’s Deputy Minister of Foreign Affairs, Thomas Mbomba, as part of the Ghanaian Vice President Dr. Mahamudu Bawumia’s official three-day visit in December last.

Speaking with DPI on the sidelines of an event last December, Minister Bharrat had shared that the agreement would work on building out Guyana’s framework and architecture to manage the new and lucrative oil sector.

“They would have developed their framework for their management of the sector quite nicely. Ghana has the experience and they certainly have the capability to… I think there is a lot that we can learn from Ghana,” the Minister had posited, as he recalled that the West African country discovered oil in 2007 and like Guyana, it began producing 120,000 barrels of oil per day.

The MOU, the natural resources minister had pointed out, speaks to collaboration, cooperation, sharing of information, capacity building, monetisation of gas because they have a national oil company and we are now looking to development of Guyana’s gas utilisation master plan.