(Kaieteur News) President of the Georgetown Chamber of Commerce and Industry (GCCI), Nicholas Deygoo-Boyer has made a strong case for the implementation of a Local Content Policy before First Oil. The businessman addressed the final day of Guyana’s second annual Guyana International Petroleum Business Summit and Exhibition (GIPEX) at the Marriott Hotel yesterday.

There has been staunch advocacy for local content policy and legislation, and criticisms of the past policy drafts have been widespread. For Deygoo-Boyer, going into oil production before a local content policy is passed would be a failure on Guyana’s part.

During the summit, the Chamber President explained in the presence of Department of Energy officials and foreign investors, that contrary to the assumption by some that local content comes at the expense of Foreign Direct Investment (FDI), it would actually have the effect of encouraging investment.

The oil sector is almost as expensive as it is lucrative. Hence, large investment sums are often plugged into projects. He explained that for someone to make a smart investment, they have to ensure that there is minimal risk to them. Recent media reports on the matter of local content and other issues closely related to the budding oil sector, he explained, may leave investors with some level of uncertainty.

This is due to the fact that though support for local content is almost unanimous, differing views on what constitutes a sufficient commitment to local content by a foreign company causes the goalpost to shift so much that investors may not be certain about where they should stand.

“I would [be uncertain too] if I was sitting in your place,” he told a room filled mostly by foreigners.

“Looking at the headlines, I’d say ‘You know, it makes me nervous to think that I’d want to risk capital in here’,” Deygoo-Boyer said.

On the other hand, he told them that the opportunity before Guyana is greater than most, if not all, of the prospects they may be considering in other parts of the world.

“It is an attractive opportunity to put capital into.”

To quell uncertainty, the bridge over uncertainty, between investors and the local market, Deygoo-Boyer explained, is a local content policy.

“Because then you have – as investors, operators, contractors – an understanding of what the rules of the game will be. So then you know this section is going to be carved up for locals or the tendering process is going to be this way…”

“So when I look at contracts, I know that contract execution and contract management must go along with these roles and methodologies.”

The Chamber President said emphatically, “Risk is not just a statistic. It’s not just about variation. It’s perception. And we must be able to mitigate risk by putting certainty into place.”

He has said that the oil sector is not just going to be useful to Guyana through the revenues it will earn the country, but through the stimulation of an upward surge in the standards of services and products that indigenous companies provide.

“I think that what the oil industry will do for Guyana, not money-wise but standards-wise, will kick off a new round of industrialization in Guyanese businesses and make us internationally competitive,” the Chamber President said.

And he believes that, with just the right ingredients, Guyana has the opportunity to make strong, fruitful partnerships with foreign investors.

The Energy Department is currently working on the final Local Content Policy. The Georgetown Chamber and various other commentators have submitted contributions for the policy to be improved upon from the shortcomings that were pointed out in its previous iterations, to one that gives locals quality participation in the Petroleum sector.

The Energy Department hopes to complete the policy before the year is out. First Oil is expected to come about during the same period.