Local content law enabling foreign, local partnerships — Dr Ramsaroop
The Local Content Law has proven important in formulating partnerships between Guyana and foreign investors, as companies abroad become more familiar with the country as an investment destination.
Chief Executive Officer (CEO) of the Guyana Office for Investment (Guyana Invest), Dr Peter Ramsaroop has stated that in the early years of the oil and gas sector, large companies initially entered the sector without the need for local partners.
However, in recent times investors have shown increased interest in local content and local partnership.
During an interview with local oil and gas news outlet, OilNow, Dr. Ramsaroop said he believes that the new wave of investments will necessitate collaboration with local companies.
“I believe a lot of the next level of investments really require local partnerships… Because the early days of the oil sector, 2020 and right before that were Schlumberger and Baker Hughes, massive companies…They didn’t need local partners. But the new players, in selling pipe coding for example, or oil services, are all companies that will require partnership and I know some of them are already in Guyana with partners,” Ramsaroop said.
He stressed the positive impact of such collaborations, noting that expanding local content in various sectors will be beneficial to Guyana, and will attract foreign investors who want to have a better understanding of the environment.
“I think local content is a good thing. I think companies want it more, and I believe as we expand local content in the other sectors, that it will be very good for Guyana, because as a foreign investor, you don’t want to come into an environment that you don’t understand completely. You don’t understand the culture or the type of workforce. So, having that local partner is a plus for investors and I see it as a plus for Guyana and it’s not a detriment,” he expressed.
The CEO stated that while there is currently no direct conversation concerning expanding local content beyond the oil and gas sector, it is something that could prove beneficial for Guyana.
“If, say, you’re coming to set up an agro-processing facility in Guyana, you would want to understand the local supply chain and which farmers can produce, or which smaller agro-processors can feed a bigger agro-processing [company]. So, I believe that it would be a good thing if we could expand local content to all other sectors,” he said.
The Local Content Laws were enacted in January 2022, after being passed in the National Assembly in December 2021. The act lays out 40 different services that oil and gas companies and their sub-contractors must procure from Guyanese companies.
Its passage aimed to strengthen the laws which ensure that Guyanese adequately benefit from the burgeoning oil and gas sector.