Much more needs to be done with Local Content in Guyana
… Crucial to the future economic development of a country – Fmr. Energy Minister T&T
Energy Minister T&T Fmr, Kevin Ramnarine
Kaieteur News – While Guyana has not fared poorly in its development of its hydrocarbon industry and related benefits in recent years, former Trinidad and Tobago (T&T) Energy Minister Kevin Ramnarine believes that “when you look at local content , for example, there is much work to do with local content, and much more Guyanese private sector involvement that could happen. ”
He admitted, however, “on the whole, when you look at what has happened, when you look at how many Guyanese have been trained and are working on the FPSOs (as required, Production Storage and Load Loading ) and the onshore drill ships etc and you’re looking at what may be coming. ”
Ramnarine was speaking during a recent webinar hosted by OilNOW where the former Energy Minister T&T gave his views on the proposed gas-to-shore project for Guyana.
Ramnarine says that in the future, more waterfront centers will be built to serve the industry that would see increased demand for local human resources.
Ramnarine’s stance was obtained a day before the Ministry of Natural Resources announced that it had completed a third draft Local Content Policy for the country.
The Ministry made the announcement last Tuesday – some two years since the country began producing oil – and reported that “… the overall focus of the stakeholder response to the draft document depends largely on the current state of Guyanese business capacity and skills. ”
This is in addition to the “expectations for improved participation and benefits from the sector, the identification of opportunities for Guyanese involvement in the industry and the need for transformation in key related sectors such as education and finance to support business improvement. which will provide for business improvement. for the needs of the growing petroleum economy. ”
Speaking to the overall sustainability of the industry and its long-term employment benefits to Guyanese, Ramnarine in his discussion pointed out that the cost of producing a barrel of oil in the deep waters of Guyana is very competitive.
He asked “when you stack it up against the cost recovery cost, let’s say, Trinidad’s shallow water, the costs of recovering oil production costs in Guyana will keep the industry alive in difficult times.”
Ramnarine suggested that this would allow when oil prices enter US $ 20s and US $ 30s a barrel “as happened last year, it’s not something that would cause you to have it, you know a hit on the heart in Guyana. ”
He chose the industry to survive last year and that is because of the cost of producing a barrel of oil compared to other deepwater provinces around the world.
As such, Ramnarine noted that “Guyana in terms of oil and gas, I think the country has not done badly, (but) of course Guyana needs to stabilize the industry by establishing the Petroleum commission and ‘ r the piece of legislation to support that. ”
He was adamant that “there is an ongoing need to educate the population and create the skills resource base which stated that“ nevertheless, many Guyanese have converted from manufacturing and gold mining, and from the bauxite industry etc., into the oil industry and the transition has happened quite quickly. ”
According to Ramnarine, “I think the government is on track with putting their foot down for local content, I think they are taking local content seriously and reiterating” local content is important for development the country’s sustainable economic. ”
The Ministry said the latest version of Guyana’s Local Content Policy came about through consultations conducted with some 180 public and private sector agencies and companies.
The latest round of consultations in a bid to finalize a local content policy for Guyana began last March 3 and ended on March 25, some 23 days later.
Guyana’s first attempt to spread a Local Content Policy that would eventually direct a legislative framework for enforcement began shortly after the discovery of Liza I in 2015 by a leading consortium led by ExxonMobil – in the Stabroek Block some 126 miles offshore Guyana its Exclusive Economic Zone.
The initiative has seen several rounds of consultations from both administrations including consultations such as the renowned petroleum expert Anthony Paul.
The Trinidadian had submitted a report that was supported by the local private sector over its proposals but subsequently deleted by the then coalition A Partnership for National Unity, Alliance for Change (APNU + AFC).
That administration employed yet another consultant, a United Kingdom (UK) resident, Dr. Michael Warner, who led another round of consultations, this time presenting a report to the then Department of Energy, since he was included in the Ministry as its Petroleum Management Unit.
That report was embodied in arguments not only over its author and its relationship with the ExxonMobil operator but the fact that the final document appeared to have removed security measures for locals and was heavily in favor of the oil operators .
That second document was never completed as a Policy which resulted in an administration led by Irfaan Ali initiating a third round of consultations that have since been completed with the date for publication of a final document.