…as Canadian oil and gas investors attend trade mission
Even as Canadian investors are expressing an interest in coming to Guyana and partnering with local businesses due to the oil and gas sector, the Government is urging these companies to look beyond just oil and gas.
This pronouncement was made by Business Minister Dominic Gaskin during an Oil and Gas Trade Mission at the Marriott Hotel on Tuesday. He noted that while investors in the oil and gas sector were appreciated and would be supported by the Government, there are other areas of opportunity.
“Guyana is on a steep learning curve and we are playing catch up with the industry. There is a high level of interest now, outside of Guyana,” Gaskin said. “And people are visiting Guyana with a lot more frequency now, to get a feel of the types of business opportunities that exist.”
A lot of discussion in Guyana centres on local content, he noted, assuring that the Government is cognisant of all the challenges and opportunities which the oil sector brings with it. This, he noted, includes the opportunities for further investment in oil.
“But I don’t want you to think oil is not the only thing happening to Guyana. There are other priority sectors which the Government will promote and that we will like to see placed on developmental trajectory before the production of oil begins,” he told the room of investors.
According to the Business Minister, the food industry has the potential to diversify on the required scale. Local content and what it will do for Guyana has been a burning question since the announcement of oil in the Stabroek block.
After ExxonMobil first tempered expectations by saying that few job opportunities will be created by oil, it has since said that it will help with local content delivery.
On the other hand, it is a fact that with the coming of oil, opportunities for investments and partnerships with local businesses will arise. For its part, Exxon has said its local content plan will be updated on an annual basis.
It has also said the plan will seek to develop the local business enterprises that will have to supply Exxon’s operations with essential goods and services.
Avoiding a focus on oil at the expense of other sectors is an important economic concept known as avoiding the Dutch Disease. Economic problems usually arise in nations with an unbalanced emphasis on the lucrative but unstable oil sector.
Guyana has its own draft Local Content Policy, which was formulated by the Natural Resources Ministry and was seen by this publication. According to the Policy, local businesses will be provided with capacity building assistance.
The document sets out that the policy will be enforced by a well-funded and resourced regulatory institution. The regulator, in turn, will be overseen by a multistakeholder group representing local bodies that are involved in the sector.
The agency’s duties will also include monitoring, evaluating and reporting on the licensing and registration process for all suppliers. It will also be in charge of creating databases for suppliers, local professionals and technicians, as well as projects. It is proposed that the body will also set targets for these projects.
The Trade Mission itself is a product of collaboration between the High Commission of Canada and the Newfoundland and Labrador Oil and Gas Industry Association (NOIA). The Guyana Office for Investment (GO-Invest) also played an important part.
Approximately 25 entities from Canada’s offshore oil and gas industry participated in the mission and are expected to stay in Guyana from September 11 to 14. The companies are here with the expectation that partnerships with local businesses can be formed.