Local Content app being developed to bring Guyanese closer to contracts, oil and gas companies – Pertab

In an effort to bring local companies closer to contract opportunities within the oil and gas sector, the Local Content Secretariat is developing an application (app) to connect Guyanese with contractors and licensees.
This was revealed by Director the Local Content Secretariat, Dr Martin Pertab, who was at the time speaking at the opening of the two-day Ghana-Guyana Local Content & Capacity Building Conference last week.
According to Dr Pertab, information asymmetry is a recurring challenge that the Secretariat is face with, where one party – such as oil and gas contractors, sub-contractors, and licensees – have more information and take advantage of another party – like Guyanese companies – during transactions.

In addressing this issue, the Secretariat has pushed for a competitive bidding process to be undertaken within the oil and gas sector especially as it relates to the 40 service areas that were specifically carved out for Guyanese and Guyanese-owned companies.
“We intend very soon, and we have already started work on the development of a local content app, which will bring locals even closer to [oil and gas] contractors, sub-contractors, and licensees… They’d be able to have access to all contracts, they’ll have access to information if you need clarity, etc. That will help address the asymmetric information kind of issue that we’re faced with because even though we have to push for a competitive bidding process, not most of the locals manage to see those RFIs (Request for Information) and when they do, the timeline is already elapsed,” the Director explained.
Dr Pertab also disclosed that there has been an increase in participation by Guyanese in opportunities within the petroleum sector.
He added too that there has also been an increase in joint ventures (JV) between local and foreign companies with many of these partnerships being formed outside of the 40 carved out areas.
“Trajectory seems to suggest that we are aligning our focus to provide a more sophisticated line of services… This is the kind of direction we want to move in. We want to move outside of those basic services and see a more advanced line of services being offered by Guyanese,” the Secretariat Head posited.
After being passed in the National Assembly in December 2021, the Local Content Act was enacted in January 2022. The Act lays out 40 different services that oil and gas companies and their subcontractors must procure from Guyanese companies.
These include 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.
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.
Only last week, Dr Pertab, in response to complaints that some Guyanese companies are entering into sham partnerships with foreign companies to capitalise on the benefits earmarked for locals – a practice called ‘fronting’ or ‘rent-a-citizen’, indicated that an enforcement unit has been set to go after those companies involved in these illegal acts.
Meanwhile, the Guyana Government had committed to reviewing the Local Content Act and expanding the 40 service areas set aside for locals.
According to the Director, the strengthening and revising of the Local Content Act is high on the Secretariat’s agenda for 2023.
With the ultimate objective being ensuring that Guyanese benefit from the opportunities that exist along the value chain in the oil and gas industry, Dr Pertab noted that work has already started on the process of drafting the new legislation. Once completed, it will be released publicly for countrywide consultations and feedback from stakeholders before being finalised and taken to the National Assembly.