Local companies accuse Aurora Gold Mine of violating contractual obligations

May 22, 2018 News

– “we are being shafted all around”
By Abena Rockcliffe- Campbell
Guyanese companies that are au fait with the local content obligations of Aurora Gold Mine are crying foul.
Owners of some of these companies, who spoke to Kaieteur News on the grounds of anonymity, are of the opinion that there is a movement to scale down the number of contracts being given to locals.
Just recently, Aurora discontinued its contract with Morrison Trucking and Equipment Rental. At least two other contractors have been told that their contracts that are coming to an end will not be renewed.
However, these businessmen are adamant that they have a right to be hired once they can adequately provide the services being sought by the gold company. “And we have been doing so for some time now… years in fact. We weren’t receiving complaints about our services, so we cannot see what has changed.”
The businessmen have referred to the local content provisions of the contract that Aurora has signed with Guyana.
One businessman said, “This is not a situation like the ExxonMobil contract where we were not protected. We have legal standing.”
This newspaper is in procession of the Aurora contract which is indeed strict on local content.
The contract states, “In Guyana, the Company shall use all reasonable efforts to give preference—to the maximum extent compatible with efficient Operations and good mining practices using standards applicable in the international mining industry—to products and services produced and offered in Guyana, provided these are offered at competitive terms and conditions.”
Further, the contract states, “the Company shall give preference to Guyanese construction enterprises and to the use of buildings which can be constructed by using materials and skill available in Guyana, to the employment of Guyanese subcontractors for road construction and transportation and to the purchase of household products and furniture in Guyana.”
The contract also stipulates that within 90 days after the end of each fiscal year, the company must submit a report to the Government “setting forth (i) the relative percentages of foreign-sourced and Guyanese-sourced goods and services used by the Company, (ii) measures taken to enhance the role of Guyanese-sourced goods and services in the Project and (ii) measures to be implemented so as to improve such performance. The report will show the performance of the Company in connection with its contribution to the economic development of Guyana over the years. The Company shall constantly use all reasonable efforts to improve such performance.”
Based on this provision, the Ministry of Natural Resources should be armed with relevant information that can tell a clear story of how much local content is being used.
The contract also makes demands on Aurora to steadily enhance its local content. But on the contrary, the company seems to be scaling its local content.
The agreement states, “The Company shall, to the extent feasible and acceptable to the Company in view of and the conditions available and in accordance with good mining practices then in use
in the international mining industry, maximize the use of vessels chartered in Guyana
other means of transport available in Guyana. If necessary, the Company shall make joint arrangements with Guyanese firms for the transportation of its material needs.”
The Aurora agreement was signed on November 12, 2011 under the People’s Progressive Party/ Civic (PPP/C). From all indications, Aurora was upholding its end of the bargain as it relates to local content until about a year ago when it moved its procurement office from Guyana to Canada. The company claimed that it had to move the office as it was getting a hard time procuring some goods from Guyana.

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