–   stresses stricter compliance with Local Content laws amid Guyana’s oil sector growth

MINISTER of Natural Resources, Vickram Bharrat, reaffirmed the critical need for “full compliance” with Guyana’s Local Content Act (LCA), which is set to be amended soon.
The Minister made this call while delivering remarks at the Jaguar floating production storage and offloading vessel (FPSO) steel strike, on Tuesday, at the Guyana Shore Base Incorporated (GYSBI), Houston, East Bank Demerara

While celebrating the successes of Guyanese companies in the rapidly expanding oil and gas sector, Minister Bharrat highlighted that stricter enforcement may be necessary to ensure all industry players align with the Act’s mandates, designed to prioritise local businesses and workforce participation.
Since its implementation in 2021, the Local Content Act has opened new avenues for Guyanese involvement in the oil and gas industry, mandating the use of local services and labour across 40 sectors.
The Minister acknowledged the Act’s success in helping local companies take on significant roles, as seen with three local fabrication companies – InFab, Zeco Group of Services and Guyana Oil and Gas Support Services Incorporated – which have expanded to meet the sector’s international standards.
These three companies will fabricate 300 tonnes of steel for the Jaguar FPSO which will include handrails, lighting fixtures, and cage ladders.

While this is a success story, Bharrat noted that some companies still fall short of expectations, underscoring the government’s commitment to enforcing the Act’s provisions.
“We have been developing a good working relationship with many companies to ensure compliance with the law. At some point in time, if we need to take harder actions, then we may have to do so, because it will be… disrespectful to not work with our Local Content law,” the Minister warned.

The Minister reiterated that compliance is essential to the Act’s purpose: ensuring that the benefits of the oil and gas sector reach Guyanese businesses and workers.
He explained that the Act is not merely a set of guidelines but a dynamic strategy that will continue to evolve as local companies gain more capabilities.

“We don’t expect any pushback from any company, and we don’t expect companies to be non-compliant with the law either. It was designed… to ensure that benefits [reach] Guyanese and Guyanese businesses without harming investment or investors,” Bharrat stressed.
The Local Content Act’s ongoing success relies on companies looking beyond the Act’s specific requirements to find additional opportunities for local engagement, Bharrat said.
“Many companies have been doing more than what is stipulated in the local content law, and that is something that we want to encourage by Exxon and contractors, SBM and others,” he added, urging companies to explore further ways to support local talent.
Minister Bharrat said that the updated LCA will close any existing loopholes and adapt to the expanded capacity of local businesses.

“A lot has changed… our local private sector has expanded and invested significantly,” he said.  This review, he assured, will be a collaborative effort between government, private sector bodies, and investors to ensure mutual benefits.
According to the legislation, companies must procure from Guyanese companies, 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 updated laws will likely include new provisions that address issues such as training and capacity building for local workers, as well as requirements for the use of local content in the supply chain.
This comes on the heels of President Dr. Irfaan Ali’s call for urgent action while raising concern about the pervasive issue of “fronting,” which poses a significant threat to the integrity of LCA.
This phenomenon – commonly referred to as ‘fronting’ or ‘rent-a-citizen’ – has the potential to reduce the financial benefits accumulated by Guyanese and runs counter to the spirit and intent of the LCA.
In 2022, the LCA was challenged by the Trinidadian-owned company, Ramps Logistics Guyana over the non-issuance of a local content certificate.

Acting Chief Justice Roxane George, S.C., in her ruling, ordered the Local Content Secretariat (LCS) to issue a local content certificate to the company. The LCS has since complied with the order.
However, the Chief Justice noted that the Local Content Act “clearly needs” regulations to prevent arbitrary decision-making.