Gov’t pushes to reduce payment period for local petroleum contractors to 30 days

The government is working to improve the payment period for local contractors in the oil and gas sector, Minister of Natural Resources, Vickram Bharrat revealed at a recent press conference.

He stated that the government is pushing oil companies to settle payments with contractors within 30 days of receiving a correct invoice. This will mark a further reduction from the 45-day payment period. Previously, payments took up to 90 days.

“We have managed to work on payments for our local contractors because again financing is an issue. So, if they are not paying within a certain particular time it basically push them out of the sector, they don’t have the resources to continue functioning,” Minister Bharrat stated.

Director of the Local Content Secretariat at the Ministry of Natural Resources, Dr. Martin Pertab also addressed ongoing efforts to resolve payment issues through local commercial banks. He noted instances where payments to local companies were made to be processed outside of Guyana.

Meanwhile, Minister Bharrat also acknowledged the issue of “fronting” where non-Guyanese entities exploit local companies to access benefits meant for Guyanese.

“We still have the issue of fronting, this is something that we will have to continuously deal with.

“The legislation was set up to benefit Guyanese not Guyanese to use it to smart the system and to take away benefits from us as a country,” the minister expressed.

Minister Bharrat urged local companies to avoid engaging in fronting practices and added: “That is selling yourself, selling your country when we fought so hard to bring benefits to our people and our country.”

The government is also investing in the training and certification of Guyanese workers to enable them to access higher-level technical roles in the oil and gas sector. The Guyana Technical Training College continues to play a key role in this effort, providing training opportunities for young Guyanese.

“We won’t want to boast of Guyanese being employed in the oil and gas sector when the employment is at the lower end of the scale.

“We believe that we can train our people to work at the technical level too in the oil and gas sector and that is exactly what we have being doing in the Guyana Technical Training College,” Bharrat said.

Additionally, there are scholarships in place to further these goals.
“We have an agreement with CNOOC, with close to 10 students currently studying in China. These young people will return to Guyana to work in the oil and gas sector,” the minister stated.

Currently, over 6,500 Guyanese are employed in the sector with efforts underway to increase the number of technical officers and engineers working offshore.

“Yes we can boast that we have over 6,500 Guyanese working in the oil and gas sector but we want to be comfortable too, to say that these Guyanese are working in technical areas as well and they are not just labourers or cleaners or helpers on FPSOs.”

The addition of the fourth Floating Production Storage and Offloading (FPSO) vessel, One Guyana, set to start production in late 2025. This is further expected to boost local employment in the sector.