At least 20 new areas to be included in updated Local Content law

Guyanese may be able to tap into additional areas of business carved out specifically for locals with the forthcoming revision of the Local Content Act, the Director of the country’s Local Content Secretariat Michael Munroe said on Tuesday.

“I can say safely that we have already identified at least 20 areas we can comfortably extend the First Schedule to,” Munroe highlighted while speaking at a panel focused on local content at Guyana’s Energy Conference.

Passed in 2021, the Local Content law has been described as one that strikes a delicate balance between the companies’ operations and investing in and using local goods and services. It has carved out specific opportunities for locals, outlining 40 different services in the First Schedule that oil and gas companies and their subcontractors must procure from Guyanese companies.

Already, more than 1,200 businesses/ companies have been registered with the secretariat. Approximately US$2 billion has been spent with locals, based on data collected by the Secretariat and shared by Munroe.

The Irfaan Ali-led government and private sector players believe this Act can be revised to carve out more areas for Guyanese, thereby giving them more opportunities to participate in the energy sector. Munroe said the goal is to make the law more “impactful and efficient,” moving beyond simple percentage targets and instead, guaranteeing that in-country value and capacity expand.

However, some challenges must be tackled too.

Fronting has been a major concern; this happens when foreign companies use locals as fronts to meet the mandatory local ownership or participation requirements. Access to financing so locals can compete for the large contracts in the sector is another issue. Munroe said the secretariat continues to monitor these challenges and believes that continued engagement with key stakeholders will help the body address those. He also said the forthcoming law revision should help to address these, too.

There are also new developments meant to boost local content.

The recently launched online Local Content Registration Portal now processes renewal applications in as little as three working days, while new applications for sole proprietors can be approved within five working days.
The portal is designed to streamline registration and certification for suppliers and contractors operating in Guyana’s oil and gas sector. The system establishes a centralised digital space that will reduce application processing times, improve transparency, and enhance the overall ease of doing business through the Local Content Secretariat.

In addition to renewals, for 100 per cent Guyanese-owned companies, new applications will be processed within 15 working days, with renewals completed in 10 working days. All other companies will see new applications processed within 21 working days and renewals within 15 working days.