Private Sector Commission (PSC) Chairman Paul Cheong has affirmed that the local business community will ensure the country and its people get maximum benefits from the burgeoning oil and gas sector.
He made the assertion during a panel discussion at the inaugural four-day International Energy Conference and Expo hosted in Guyana from February 15 to February 18, 2022.
The Local Content Law, he noted, will be key in ensuring all Guyanese benefit from the country’s oil wealth.
“We want to ensure that we, as a country, we get maximum benefit from these resources,” Cheong remarked.
“We in the Private Sector, we have a Local Content Advisory Group which we set up with professionals and technical people around the oil and gas sector to advise us and to help model and mould the way we would advocate going forward in the future for different services available to the Private Sector,” he added.
He noted too that the local Private Sector was working closely with the Guyana Government and oil and gas operators in a bid to better understand the sector and further build local capacity.
“We’ve been working closely with the Government, but we also intend to work closely with the operators and contractors, subcontractors to understand the other categories, so we can disseminate that information on to the wider Private Sector and also to help build capacity so that they can participate in a more meaningful way in the operations,” the PSC Head noted.
But in ensuring Guyanese get maximum benefits from the sector, Cheong underscored the importance of striking an appropriate balance within the industry.
“There has to be a balance, because, [if] you go overboard, taking the targets too high and if we don’t have capacity, it can be of hinderance to the industry. We don’t want to be in that position because we know of the importance of this resource to our future as a country, our future as the Private Sector…
“We also recognise the importance of foreign investment and we welcome foreign investment; we also feel foreign investors should benefit in a fair way for their investment and effort,” Cheong reasoned.
The Local Content Act lays out 40 different services that oil and gas companies and their subcontractors must procure from Guyanese companies by the end of 2022. For instance, these companies must procure from Guyanese companies, 90 per cent of office space rental and accommodation services; 90 per cent janitorial services, laundry and catering services; 95 per cent pest control services; 100 per cent local insurance services; 75 per cent local supply of food, and 90 per cent local accounting services.
These are just a few of the services highlighted in the first schedule in the Local Content Act. The Local Content Act penalises oil and gas companies and their subcontractors who fail to meet the minimum targets of the legislation, as well as those who are in breach of the Act. These fines range from as low as $5 million to as high as $50 million.
The Government, through the Natural Resources Ministry, has since operationalised its Local Content Registry as stipulated by the law.
