Latest update January 18th, 2025 4:15 AM
Last week for submission of comments on draft Local Content Policy – Energy Dept. Head
By Kiana Wilburg
Head of the Energy Department, Dr. Mark Bynoe has noted that while there have been concerns in the media about the weaknesses of the third draft of the Local Content Policy, formal submissions are yet to be received.
Energy Department Head, Dr. Mark Bynoe
Trinidadian Local Content Expert, Anthony Paul
British Consultant, Dr. Michael Warner
During an interview on Kaieteur Radio’s “Guyana’s Oil and You” Programme, the official cautioned that this is the last week for which an extension would be granted to receive comments. He said that while he would like to have the policy in place before first oil, the absence of commentary is what appears to be holding up consultant, Dr. Michael Warner in finishing the document.
Dr. Bynoe also sought to remind that the policy is in draft mode and is subject to change. The Director of the Energy Department categorically stated that ultimately, he wants a document that will bring the most benefits to Guyana.
During the discourse, this newspaper brought to the attention of Dr. Bynoe, the contentious provision in the draft, that proposes to make confidential, the Local Content Reports submitted by oil companies.
It was also highlighted that Ghana and 20 other countries do not support or have in their policies, such restrictions which would hinder the ability of the citizenry to hold the regulators, the companies and the government, accountable on the issue of local content.
Dr. Bynoe said that from where he sits, if the reports can be revealed, it would serve to debunk rumours that Guyanese companies are not benefitting from the oil supply chain and that many locals are not being employed.
He reminded once more that submissions regarding the weaknesses of the draft local content policy can be submitted this week to the Department of Energy which is housed in the Ministry of Presidency. (SEE LINK FOR A COPY OF THE POLICY: https://motp.gov.gy/images/Guyana_Local_Content_Policy_Petroleum_Sector_Aug__2019_r17FINAL_DRAFT-2.pdf)
KAIETEUR NEWS ANALYSIS
When this publication was able to secure a copy of the draft policy over a month ago, a comparative analysis was subsequently done between Ghana’s Local Content Policy that was authored by Trinidadian Expert, Anthony Paul and Guyana’s draft that was finalized by British Consultant, Dr. Michael Warner.
It is important to note that Paul had done the first two drafts of Guyana’s local content policy but he was bypassed when the time came for it to be finalized. Dr. Warner was chosen instead.
In the chart below, Kaieteur News exposes those provisions in Ghana’s policy that seek to ensure maximum use of goods, services and labour while highlighting how they are blatantly absent from Guyana’s draft.
| Ghana’s Local Content Policy done by Trinidadian Local Content Expert, Anthony Paul | Final draft of Guyana’s Local Content Policy by British Consultant, Dr. Michael Warner |
| 1) In the case of non-Ghanaian ownership and operations, the entity must provide for the participation of a citizen of Ghana in an interest of at least five percent in the exploration and production activities under petroleum licenses. The interest of the citizen of Ghana shall not be transferable to a non-citizen of Ghana. |
NO SIMILAR PROVISION |
| 2) In order to ensure increased financial benefits to Ghanaians, and the Ghanaian state, all operators in the oil and gas industry, shall as far as practicable use goods and services produced by or provided in Ghana for their operations in preference to foreign goods and services. The Operators shall give priority to the purchase from citizens of Ghana local products and services that are competitive in terms of price, quality and timely availability. A preference for Ghanaian entities, even if they are up to 10% more expensive is mandated. |
NO SIMILAR PROVISION |
| 3) Where bids are being evaluated, and where bids are otherwise equal, the bid containing the highest level of Ghanaian content shall be selected. |
NO SIMILAR PROVISION |
| 4) Where a foreign entity is to provide goods and services for the licensee, the foreign entity shall operate from Ghana and partner with a Ghanaian owned and registered company. After the commencement of operations, the participation of Ghanaians shall be at least ten percent by value in the provision of goods and services or as may be prescribed by regulations. The percentage contribution shall increase to at least twenty percent in the second year and shall increase by at least ten percent each year thereafter or as may be prescribed by regulations. These targets shall be assessed and revised annually as part of the regular assessment of the Annual Local Content Plan to determine the progress of national entities relative to their competitiveness with respect to price, quality, and timely availability and other commercial terms.
(“Operate from Ghana” means that the foreign entity shall be incorporated under the Companies Code, 1963, Act 179.)
|
NO SIMILAR PROVISION |
| 5) An Operator shall publicly advertise and give preference to the employment of citizens of Ghana who have the requisite qualification, competence and experience required to carry out the required work. With respect to employee training, an operator shall prepare a scheme for the training of its Ghanaian employees. For the effectiveness of this policy, the scheme shall be submitted to the Petroleum Regulatory Agency for approval as part of the Annual Recruitment and Training Programme. Where such a programme or a scholarship proposed to be awarded has been approved by the Regulatory Agency it may not be varied without the permission of the Regulatory Agency. Where Ghanaians are not employed because of their lack of training, the Operator shall ensure that every reasonable effort is made within a reasonable time to supply such training locally or elsewhere. |
NO SIMILAR PROVISION |
|
6) The Operator shall, within twelve months after the grant of a licence (or effective date of a Petroleum Agreement), submit to the relevant Regulatory Agency for approval, a detailed Annual Recruitment and Training Programme for recruitment and training of citizens of Ghana in all job classifications and in all aspects of petroleum activities, which may be carried out in or outside the country. The Annual Recruitment and Training Programme shall ensure that the following targets are met : (a) management staff, at least fifty percent of the management staff are Ghanaians from the start of petroleum activities of the licensee and the percentage shall increase to at least eighty percent within five years after the start of the petroleum activities; (b) core technical staff, at least thirty percent of the technical staff are Ghanaians from the start of petroleum activities of the licensee and the percentage shall increase to at least eighty percent within five (5) years after the start of petroleum activities and ninety percent within ten (10) years; and (c) Other staff, one hundred percent are Ghanaians. Such programme shall provide for the training of Ghanaians in all aspects and phases of petroleum activities and as many staff categories, including management, as is possible and shall be reassessed and revised on an annual basis (the “Annual Recruitment and Training Programme) and may include scholarships, industrial training for students and other financial support for education. |
NO SIMILAR PROVISION |
| 7) In order to ensure competitiveness of Ghanaians in the provision of the full range of services required in the oil and gas industry, the local training and technical institutions will be supported by both Government and the petroleum operators to develop the requisite capacity to international standards to be able to train Ghanaians to comparable high levels as required by the industry in drilling and support services, marine, catering and housekeeping, supplies and other support services. This measure will focus on all aspects of training, including the following: (i) Lower skill artisanal training such as welding, catering services; (ii) Middle-level skill training of technicians to provide maintenance services, offshore and on shore drilling etc.; (iii) High level skill training including general management, engineering design, procurement and business strategy development.
Attention will also be given to technology development skills towards indigenization of oil and gas technologies. High level seminars and workshops will be used to create the necessary awareness and interest of local businesses in the development of the requisite technologies and provision of technical support for the oil and gas industry. |
NO SIMILAR PROVISION |
| 8) An Oil and Gas Business Development and Local Content Fund will be established to support local capability development aspects of the local content framework. The fund will be used primarily for education, training and research and development in oil and gas. Sources of the fund will include contribution from Licensed Operators (at amounts specified in the applicable Petroleum Agreements), Oil and Gas Revenue, levies, grants and other support from Ghana’s Development Partners. The Ministry of Energy or the Ministry responsible for petroleum will oversee the disbursement of the fund.
|
NO SIMILAR PROVISION |
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