-Natural Resources Minister asserts, says law has made Guyana attractive for investors
MINISTER of Natural Resources Vickram Bharrat has defended Guyana’s local-content legislation, arguing that it has exceeded expectations by expanding opportunities for Guyanese, while continuing to attract foreign investment.
Bharrat made this known during a recent episode of the ‘Starting Point’ podcast, during which he stated that despite early concerns that the law would discourage companies from entering the country’s oil and gas sector, it has done the opposite.
“There are many who said initially that local content will kill the sector, that it will keep out foreign investment from Guyana, and we have proved them wrong,” the minister said.
According to Bharrat, the legislation has enabled Guyanese businesses and workers to participate meaningfully in the rapidly expanding petroleum industry, creating opportunities that may not have existed without a legal framework requiring local participation.
It was then that he pointed to examples of farmers supplying produce for offshore operations, Guyanese-owned catering companies providing meals aboard floating production, storage and offloading (FPSO) vessels, and local businesses offering transportation, accommodation, legal, accounting and other professional services to companies operating in the sector.
“In many countries where there is not a legislation, you find that the locals are basically locked out of the sector because they’re not given the opportunity to build their capacity and get truly involved in it,” Bharrat said.
Against this backdrop, he explained that international oil companies often rely on long-standing overseas suppliers and service providers, making it difficult for local businesses to enter the industry without government intervention.
“We had to break that cycle,” he said.
As such, he noted that Guyana’s legislation requires companies to source a range of goods and services locally, while establishing minimum targets for areas such as food supply, transportation and medical services.
Added to the sectors listed under Schedule One of the Local Content Act, the minister stated that the legislation has been influencing investment decisions, with foreign companies increasingly seeking Guyanese partners before expanding their operations.
He said investors recognise that additional services are likely to be incorporated into the legislation over time and are therefore establishing partnerships with local businesses from the outset.
To this end, he disclosed that many Guyanese companies have entered joint ventures with international firms, enabling them to access the capital and expertise needed to compete in the oil and gas industry.
Bharrat also highlighted the employment and training benefits arising from the legislation, noting that oil companies and major contractors are legally required to train and employ Guyanese while reporting on their compliance to the Local Content Secretariat.
