The Government of Guyana is not in a position to say if it agrees or disagrees with ExxonMobil’s interpretation of what qualifies as local content. According to Minister of State, Joseph Harmon, “We will eventually get to that…”
The Cabinet Secretary made this remark during his post-Cabinet press briefing which was held today at the Ministry of the Presidency.
There, Harmon was told that ExxonMobil considers any money it invests into the economy to be “local content.” This also extends to any funds spent by ExxonMobil’s contractors and subcontractors.
Harmon was asked to state if this interpretation is in sync with Government’s understanding of what is local content; and, if that stands to reason why Government saw it fit to publish a list of 228 companies used by ExxonMobil and its contractors on Tuesday. (See link for full list of companies https://docs.google.com/spreadsheets/d/1k9poJOdaBpMhetsEZ0a39mn2U1GHb3VrMfi-UtPbFpI/edit#gid=2010221307)
The politician said, “Every entity looking at local content will have an interpretation of what local content is or what the cost or value of it is…I want to say that it is the government and the people of Guyana that will help fashion what is the correct interpretation of local content. It is for us to determine…”
Harmon added, “The matter of what it is and what it is not, we will eventually get to that at some point…I would not like to speculate as to an interpretation…There has been a publication about companies benefiting from the investment taking place and beyond that, I would not wish to state further.”
The Minister of State sought to remind media operatives that the government is working “assiduously” on a Local Content Policy, the second draft of which has been released. The author of Guyana’s draft policy is Trinidadian Oil and Gas Expert and Consultant, Anthony Paul.
Paul has crafted similar policies for several countries, Ghana and Trinidad and Tobago included. While the definition of local content in Guyana’s draft policy is in stark contract with ExxonMobil’s interpretation, it still pales in comparison to those of more than 20 other countries.
Guyana’s draft policy states, that local Content is considered the sum of the inputs of local goods and services, including employment, provided in oil and gas operations. (https://www.nre.gov.gy/wp-content/uploads/2018/05/Second-Draft-Local-Content-Policy-Framework.pdf)
In other countries, strong local content definitions speak to the “significant” use of local skills and services as well as meaningful capacity building and transfer of technology. (See link for further details: https://resourcegovernance.org/sites/default/files/nrgi_Local-Content.pdf)