THIS week’s latest oil discovery – ExxonMobil’s 10th in Guyana – is yet another reminder that oil is coming soon. As 2020 approaches, things are quickly getting serious for Guyanese firms looking for opportunities to participate in the burgeoning oil and gas industry.

Last week the Center for Local Business Development (CLBD) and ExxonMobil Guyana hosted the Supplier Development Forum for Liza Phase 1. The forum was an opportunity for local companies and Exxon’s primary contractors to discuss their scopes of work, procurement forecasts and opportunities in 2019 and more.

ExxonMobil Guyana representatives, like Country Manager Rod Henson, highlighted key areas where local businesses can increase their competitiveness for contracts by implementing international standards for health and safety, environmental and regulatory compliance, quality, and cost competitiveness.

Henson’s emphasized the company’s “long-term commitment” to Guyana. This is especially true given the ongoing streak of discoveries offshore, the 10th of which came this week. Exxon’s long-term presence should be promising for business owners who are looking for stable demand to responsibly invest in long-term capacity-building.

The event was broken into two days, the first focused on helping the 300 companies that have already submitted expressions of interest to better understanding the procurement process. The second day was an opportunity for ExxonMobil and its primary contractors to network with the 1000-plus local companies that have registered with the CLBD.

Crucial to the event was the inclusion of Exxon’s “tier 1” suppliers. These companies are Exxon’s primary contractors on the project—mostly large international oil and gas service companies with specialized services. These contractors are the primary target for many local firms since they are the companies which need the subcontractor support that many Guyanese firms are well equipped to provide.

These firms include drillship operators like Noble Corporation and Stena, subsea control systems-specialists like Saipem, geophysical firms that conduct seismic surveys like TechnipFMC, and other oilfield services companies like SBM and Schlumberger.
Schlumberger is a great example of the kind of opportunities available for Guyanese companies. In June, they advertised and contracted Guyanese firms to help build and renovate facilities for a drilling fluids facility at the Houston Port on the East Bank of Demerara.

Chairman of the Private Sector Commission, Desmond Sears, lauded the work of the CLBD in supporting and training local firms and highlighted the opportunities for joint ventures to combine basic local capacity, capital, and manpower, with specialized international industry expertise.
Sears also noted that many Guyanese companies have already taken advantage of opportunities for contracts in the industry and are investing to develop their capacity to take on more specialized roles.

Representatives of such companies were in attendance at the event, some of which have already achieved the prestigious ISO:9001 certification for quality management, which is often required in an industry where extremely precise technical work and strict safety standards are the norms.

Government representatives like Joanna Simmons-Homer of the Department of Energy also emphasized the high standards of the industry and its notoriously steep learning curve, but noted that “nonetheless, success stories are emerging.”

Despite this progress, it’s important to recognize that the industry won’t necessarily touch every business and won’t employ every Guyanese. The reality is that oil extraction offshore is not a particularly labour-intensive industry. Many of the opportunities discussed last week require high technical capabilities which only a handful of companies worldwide can provide.

However, the potential revenue flowing into Guyana and long project timeline indicate that there will be ample opportunity and time for local businesses in various sectors [to] increase their capacity and have a role in this arena, and that translates to greater opportunities and development for Guyanese citizens.