Local Content Act could be revised later this year – AG

Attorney General Anil Nandlall, SC, has assured that the Local Content Act could be put through revisions later this year to expand the carved-out areas of opportunity for Guyanese, following consultations with relevant stakeholders and further data from the Local Content Secretariat.
During the recently held Local Content Summit at the Pegasus Hotel and Suites, he informed attendees that the government is currently waiting on the Local Content Secretariat to complete its review of the sector’s performance.
Once a report is forthcoming and consultations completed, he noted that the government can go ahead with revising the Act later this year… since expanding the services, Guyanese are guaranteed first preference for in the oil and gas sector falls under the remit of the subject Minister and does not rely on parliament. However, Nandlall stressed that this was no one off revision.
“We have the Local Content Secretariat that continues to monitor and we have said this from the beginning. That after a period we will look at the data collected from the Local Content Secretariat, speak to you the operators in the sector, both the foreign operators and local. And then we will come back to the drawing board, to make the revision of the Act,” he said.
“And it’s not going to be a one-off event. We’ll have to revise it at another stage. It’s an evolving process. And we said at the beginning, it is our first try. It’s a novel concept. It has never been done in this part of the world. We said that we would make mistakes. We said that it may turn out to be inadequate and perhaps it has. But it’s a solid start,” Nandlall said.
According to the Attorney General, the Act is based on an elastic, build as you go principle so that the legislation remains alive and responsive to changing needs in the industry. Added to this is the government’s efforts to ensure persons are trained to take up the opportunities in the industry, whether through the Guyana Online Academy of Learning (GOAL) or the University of Guyana.
“That is why the scale, the annex where the services are listed and the percentages are given, it’s a sliding scale. And we said at periodic intervals, not only will we amend the Act itself, but this scale. We made it as part of a schedule, which can be amended by the Minister, by order. So, you don’t have to go back to parliament and go through that long process.”
“You are aware of the GOAL scholarship programme. And a large part of that programme is dedicated to offering scholarships and training for the oil and gas sector. Then at the University of Guyana level, we have discussed with the University of Guyana. And there’s a whole new area of the syllabus, to focus in this direction,” Nandlall said.
In December 2021, the National Assembly passed the Local Content Act which outlines 40 different service areas that oil and gas companies and their subcontractors must procure from Guyanese and Guyanese-owned companies.
These include 90 per cent of office space rental and accommodation services; 90 per cent of 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.
The Local Content Act mandates penalties such as fines ranging from $5 million to $50 million for oil and gas companies and their sub-contractors who fail to meet the minimum targets of the legislation, as well as those who are in breach of the Act. (G3)