GOGSPA Praises Local Content and Local Participation Law
By Gilbert Boyefio
“The opportunities for Indigenous Ghanaians in the upstream oil and gas industry have increased drastically due to the local content regulations, 2013 (LI 2204),” said Nuertey Adzeman, Executive Director of the Ghana Oil and Gas Service Providers Association (GOGSPA).
He said the L.I. shows the determination of government of Ghana to get Ghanaian SME’s to own the oil and gas industry, reduce capital flight, unemployment, and improve Technical and Managerial Capacity as well as accelerated growth of the Ghanaian economy.
He pointed out that the L.I has also made it compulsory for all foreign companies to have Joint ventures (JV) with indigenous companies.
Mr. Adzeman also applauded the Petroleum commission for encouraging the IOC’s and the FSC’s to unbundle their procurement contracts to enable more participation of indigenous companies.
GOGSPA is an advocacy, lobbying and monitoring association with the mission to strengthen the competitiveness of indigenous companies in the oil and gas industry, to train and build the capacity of members and to work closely with all stakeholders in the industry.
It promotes the interests and integrity of oil and gas service providers in Ghana, to ensure that they carry out their activities to the highest professional standards achievable.
GOGSPA also facilitate and promote local content in the oil and gas industry and compliance with local, international standards, procedures and practices in the petroleum industry.
Challenges facing the local players
Mr. Adzeman cited fronting; limited technical know-how or capacity; financial constraint; cost to capital; access of capital, stringent requirements for loans; prefunding and credit facility (30 – 45 days, tender requirement to prefund all services); recent decline in offshore activities; and the absence of special tax exemptions, waivers and incentives for local companies as opposed to similar exemptions enjoyed by foreign resident companies in the extractive industry, as some of the challenges confronting the indigenous players in the industry.