Following the announcement of an ExxonMobil contract for oil & gas services, the Georgetown Chamber of Commerce and Industry (GCCI) is calling on the government to urgently address the issue they believe is in contravention of both Guyana’s and Trinidad and Tobago’s local content laws.
“ An Exxon logistics contract was advertised and it says bundle or unbundled, but it has 10 areas and bundles Guyana and Trinidad together… when you bundle Guyana and Trinidad you are going against both countries’ policies of local content,” President of the GCCI, Timothy Tucker, told Stabroek News yesterday.
“You have customs brokerage, immigration and agencies work together. We have certified ISO customs brokers but they don’t do agency or immigration, and they can’t bid if they are lumped together. Each should be awarded separately. You are empowering one company, rather than giving opportunities for several companies,” he argued.
Tucker disclosed that GCCI has received several complaints from private sector members and they have already complained to the Local Content Secretariat.
On the bundling of Guyana and Trinidad and Tobago works, he said that the GCCI sought clarity from the T&T lawmakers on that country’s policy and framework and “confirmed that we are going against it.”
“All of that we are looking at and are appealing to the government, through the Local Content Secretariat to please intervene,” he said.
Stabroek News yesterday tried contacting Head of the Local Content Secretariat Martin Pertab but calls to his mobile number went unanswered.
Tucker’s comments followed a release from the Chamber yesterday stating that it has taken note of recurrent contract bundling practices within Guyana’s petroleum sector and that it wanted to express its disapproval of this practice.
“Contract bundling, which is the consolidation of the procurement of various goods and services under one contract, has seemingly become a practice of companies within the petroleum sector. Contracts are being solicited for expression of interest (EOI) and requests for information (RFI) under one umbrella by various players in the industry. The sum-effect of this practice is that micro, small and medium-sized enterprises (MSMEs) are unable to compete in the space since the ‘bundling’ practice will set an artificial barrier to their participation,” the release explained.
“Apart from its obvious hindrance to MSMEs wishing to service the sector, the Chamber believes that contract bundling works against the spirit and intent of the Guyana’s Local Content Act (2021) thereby defeating the objectives of the Act as it relates it relates to private sector development. The Chamber calls on the Local Content Secretariat of the Ministry of Natural Resources to examine this practice and its harmful effects on the full utilization of the Local Content Act and, by extension, private sector development in Guyana,” it added.
This is not the first time GCCI has registered its concern about the procurement practice for oil and gas contracts.
In April of this year, the Chamber had lodged a complaint with the Local Content Secretariat over the practice here by foreign companies of bundling contracts for services in the oil & gas sector to the disadvantage of local companies.
Tucker had explained that the complaint had come in light of the revelations that US-based medical services provider RemoteMD, charged large fees for COVID-19 testing after obtaining the contracts and then subcontracting the work to local companies.
He posited that while locals are fully capable of executing some jobs required by big oil companies and their subcontractors, the jobs are being lumped into contracts with other work that requires the prospective contractor to have years of oil and gas experience.
Tucker said it is for these reasons that locals have a regulatory body to turn to for redress that highlights the importance of the country protecting itself with local content legislation. “We think this is why the local content legislation is so necessary and even more reason why we need it. We are happy we have a flexible legislation that can be adopted for these kind of things,” he said.
Pointing to the RemoteMD example, Tucker questioned the logic of there being a local company doing the “actual work” and there being confidence in its results, but the contract going to a third party foreign company which charges more and rakes in a decent profit in the process.
He said that he was not sure of medical services requirements under the new local content legislation, but he is sure that “it is still going on. This is a case that was probably going on before the local content legislation.”
