Natural Resources Ministry, Private sector to examine 30-day payment period for businesses in oil sector

The Private Sector Commission (PSC) on Tuesday raised the issue of the lengthy time it takes for local companies to receive payments from contractors, sub-contractors and licensees operating in Guyana’s oil sector with a view to changing this practice. The PSC at the time held a meeting with Minister of Natural Resources Vickram Bharrat and representatives of the Local Content Secretariat to discuss issues relating to Local Content.

Also raised was the issue of unbundling of contracts to allow greater participation by Guyanese businesses. This entails breaking contracts into smaller units to allow local companies to bid for projects. According to joint statement, both sides agreed to continue pushing for the unbundling of contracts and examine a thirty (30) day payment period for small and medium-sized businesses.

Businesses have long complained about the time taken to receive payments from players on Guyana’s oil sector with wait time being as long as twelve (12) months.

Other issues discussed were the need for continuous awareness of Local Content issues and greater participation by members of the business community. It was agreed that the PSC and MNR will convene a one-day forum in September 2022, to discuss Local Content issues. Additionally, both parties agreed to collaborate on conducting outreaches across the country aimed at sensitising Guyanese about the local content legislation and opportunities therein.

As part of efforts to strengthen the Local Content programme and enable more opportunities for Guyanese businesses, Minister Bharrat invited the PSC to be part of an ongoing process that the Ministry is leading to examine the current schedule in the Local Content legislation and propose changes that can be examined.

The PSC, through its Local Content Advisory Group, has been engaging the Local Content Secretariat on a monthly basis to share information and discuss local content issues.

The meeting held in the Boardroom of the Natural Resources Ministry was attended by Chairman of PSC, Mr. Paul Cheong; Chairman of PSC’s Local Content Advisory Group (LCAG), Mr. Shyam Nokta; LCAG Member, Mr. Joel Bhagwandin; Executive Director of the Georgetown Chamber of Commerce and Industry (GCCI), Mr. Richard Rambarran and Executive Director of the PSC, Mr. Ian Chung. The Ministry’s team included Director of Local Content Secretariat, Mr. Martin Pertab, Senior Petroleum Coordinator, Mr. Bobby Gossai, Head of Compliance, Mr. Mark December and Legal Officer, Mr. Michael Munroe.