Existing industries seeking boost from oil and gas local content framework, consultant says
-capacity building and value-adding seen as vital
Consultations on the Local Content Policy for the oil and gas industry have urged that existing sectors not be neglected and for a way to be found to build capacity and better all industries.
Trinidadian consultant and energy specialist Anthony Paul, who is charged with drafting the local content framework for Guyana’s petroleum sector, underscored this point on Friday as he briefed the media on his seven-month-long consultations countrywide.
“What they are saying is that look, ‘We don’t want to all leave to go look for oil and gas. What we would like to see in addition to the oil and gas strategy is to make sure that you don’t forget us. Give us roads, give us electricity, give us infrastructure give us whatever we need to run the businesses,” Paul said.
“This is something the government would have to look into in order to not destroy other sectors of the industry,” he added.
Paul noted that similar feedback was received from across Guyana as he held discussions in the three counties which included organisations such as the Georgetown, Berbice and Essequibo Chambers of Commerce and Industry, the Private Sector Commission, the Guyana Manufacturing and Services Association, the African Business Roundtable, the Guyana Oil and Gas Association Inc, the Guyana Bar Association, the Institute of Chartered Accountants of Guyana, Go-Invest, the Guyana Geology and Mines Commission, the Environmental Protection Agency and the Maritime Administration Department.
Representatives from Regional Democratic Councils also formed part of the stakeholder outreaches.
“The Guyanese business people from Georgetown, Linden, Berbice and Essequibo are very pragmatic. They were not about ‘give us things,’ they were about ‘help us to understand what we need to do to get up to speed,’” Paul said.
“What I found was people are not keen to leave their existing businesses at all. They are saying ‘this is what we do and do well,’ which was not the focus of these conversations but speaks to a point that Guyana wants to avoid the resource curse.
“It wasn’t part of the sessions but an important part and constant that we had to keep in mind. [They asked ] ‘How can revenue from the sector help our part of the economy grow?’ Nobody is looking for a handout.
“They were saying to us ‘Let us know what is needed, let us know what we have to do,’” Paul added.
He made it clear that the framework addresses not just how Guyanese will get employed and get contracts but also how capacity is built in Guyana, which in turn goes beyond and also speaks about value addition.
Limited lifespan
Value addition, he explained, will be quite important in the Guyana perspective since it is twopronged and offers not just training but direction on using skills gained from foreign companies to better products and services.
“The other part, which I think is quite important, is about Guyanese gaining value. It is about Guyanese gaining knowledge and skills, through the transfer of knowledge from foreign companies, so Guyanese businesses improve the standard of the quality of service that they deliver. They will also become more competitive and productive and are therefore able to use the amount of foreign expenditure, keeping things local, and earn foreign exchange. Oil and gas has a limited lifespan, and in order for Guyana to benefit we must be able to take Guyana beyond oil and gas,” Paul said.
“The oil and gas industry uses business skills and services all industries’ needs but uses them to a high standard. Having these oil companies who are some of the higher companies in the world, be it Exxon, Tullow, Schlumberger, Halliburton etcetera, would mean bringing services to their standard and this means Guyanese companies will raise their companies to international standards. Many of those services that they use are business services, such as IT and accounting etcetera, [and] are needed by other sectors in the economy. Local content is not just about getting employment but raising the quality of services in Guyana to help Guyana develop.
“The opportunities in oil and gas is that oil and gas companies do have the ability to build capacity. The policy now will aim to make sure that all of these things happen efficiently,” he added.
To this end, he explained, he would be crafting the policy framework to meet both short and long-term skills so that locals can fully benefit from procurement of works and services in the sector.
“Yes, Guyanese are limited in what they can do to support the oil and gas sector but there are some things they can do already. Maybe low level, but certainly you don’t get a chance to improve what you have until you participate.
“What we are saying in the policy is that local Guyanese should be given preference in areas where they are already competent and meet standards. In areas where they are not, and their current status allows them to be built up, to become competitive. Then they will be given a chance to participate, either directly or with partnerships, who would transfer their knowledge, technology work procedures… to Guyanese,” Paul said.
“So, first, Guyanese would be given preference; secondly, a chance to grow and in so doing, thirdly, would become world-class.
“Having become worldclass, Guyanese are now potentially [able] to export their services internationally…and that is the idea of using local content, using capacity building... Capacity building has two facets: education and experience and the policy drives at both of them.
“So, as we do that we understand the need to get training institutions up to speed and the companies to understand their role in engaging local suppliers and bettering them,” he added.