President of the Georgetown Chamber of Commerce and Industry (GCCI) Nicholas Boyer on Wednesday emphasised the need for a local content policy and regulatory legislation to protect investments by both the public and private sectors in the emerging oil and gas industry.
Boyer made these comments at a press conference after returning from an Offshore Technology Conference (OTC) that was held in Houston, Texas last week.
“We, as a private sector, have played our cards and are willing to make the investment, learn and inculcate new behaviours and new standards into what we offer. What we need is that regulatory environment that starts with a policy and ends with legislation that says there is a need for local content in this industry,” Boyer explained, while noting that even though there are many examples of efficient local content policies around the world, there is a need for Guyana to learn quickly and implement such a policy and related legislation.
Also attending the press conference was Chair of the Petroleum Committee of the Chamber Charles Ramson Jr.
Ramson Jr noted the Chamber’s efforts to secure the completion of a local content policy, including its submission of a four-page draft bill to the Ministry of Business last year and its continued lobby for the government to speed up the process and finish the legislation before first oil.
He said if the country does not meaningfully engage the industry where work is concerned then “we are going to be selling Guyana short.” He further noted that the policy must ensure that there is a certain percentage of local employees working in the industry, a margin where Guyanese businesses can bid for contracts and also provisions for ring-fencing certain sectors in order to prioritise local businesses.
Boyer also pointed out that there is a need for the policy to be in place before first oil in order to stop depending on operators’ internal local content policies, which he said is no excuse for the government to not already have a policy in place.
“We’ve invested in it already, consultants and consultations. If this was the private sector and government was being run as a company, somebody would’ve had to answer the questions on how did we get so far and invest so much and not have the policy,” he added.
Asked if the GCCI was satisfied with the data that ExxonMobil put out on local content, Boyer explained that the company is going to measure local content based on its own policies and if the country wants to see better reporting then the regulatory environment has to be created to facilitate that. “We need to request the info we would like to see. If our Department of Energy [DoE] wants to measure local content then we need to have our definition and our metrics which is defined by the policy… If I were running the Department of Energy, I would’ve engaged with the operators and created a Local Content Commission, asked for a certain set of metrics and reporting. Maybe do my own study under the complete supply chain of Exxon needed to carry out their first project, see where the gaps were and asked Exxon to report what they were doing and then my own internal study,” he added, while noting that the oil company’s reporting standard was not in line with the draft legislation that they would’ve submitted to the Ministry of Business.
However, despite this, Boyer said the trip to the conference was a success and will not be the last for the private sector of Guyana. He noted that everyone found it useful in building a network, increasing the presence of Guyana in Houston and also learning about the industry like “we had never seen before.”
The delegation would have participated in a supplier night that was arranged by the Guyana Office for Investment and sponsored by ExxonMobil where they were able to speak to approximately 400 ExxonMobil suppliers.
“I think that the information presented there really satisfied a thirst for what is going on in the Guyana market. It gave people an overview of the government’s perspective and so we had the Department of Energy, the Guyana Geology and Mines Commission (GGMC) who did an overview on the Basin and I presented on what the Private Sector is expecting from this oil find,” he added.
While he could not expound on whether specific companies made any specific inquiries for possible partnerships, Boyer pointed out that a number of non-resident companies showed interest in joining the GCCI.
He also noted that in order for businesses to reach to the next level of being able to supply to the industry, there is going to be a need for some amount of importing experience and systems and investments to reach international standards, which he noted is not impossible and “definitely doable from our end” but “we are going to need some help from local content… we need policies and we need legislation.”
DoE head Dr. Mark Bynoe had said earlier this month that the Department is aiming towards finalising the completion of the consultancy for the local content policy by the end of June, and after that it will be taken for consultations with the private sector and other stakeholders.
