Local Content Compliance: Employment And Training Of Non Skilled Ghanaians In The Upstream Industry.

Local Content is an obligation recognized in any exploration and production contract (such as concession agreement, petroleum agreement) or by law or regulation and enjoining companies to procure a minimum percentage of goods, equipment and services from local suppliers.

The object behind Ghana's local content requirement is to ensure the involvement of Ghana's own industry including its national oil company (i.e Ghana National Petroleum Corporation) in the development of the exploration, production and decommissioning value and supply chain.

One of the most significant key objectives sought to be actualized under the local content platform is the maximization of the benefits of oil and gas industry wealth generation on a comprehensive local content platform by maximizing the use of

local expertise, goods and services, job creation for the people, businesses and financing in all aspect of the oil and gas industry value chain and the retention of the benefit within Ghana. Regulatory Authorities

The Petroleum Commission The Petroleum Commission created by Petroleum Commission Act, 2011 (Act 821) was established for the purpose of overseeing activities in the country's petroleum industry and its functions extend to promoting local content and local participation in petroleum activities as prescribed in the Petroleum Exploration and Production Act 1984 (P.N.D.C. Law 84) and other applicable laws and regulations to strengthen national development.

In exercise of powers conferred on the Minister of Energy by Act 821, Ghana's Local Content and Local Participation Regulations were made. The Regulation which came into force on the 20th day of November, 2013 is known as Petroleum (Local Content and local Participation) Regulations, 2013 L.I 2204. Despite establishing the Local Content Committee, the Commission still retained its duty of promoting local content and local participation in the petroleum activities and shared the responsibility of implementing the provisions of the Regulations with the Local Content Committee.

Local Content Committee The Local Content Committee was established by Regulation 5 of L.I 2204 and is saddled with the duty of overseeing the implementation of the Regulations. The duties of the Committee extend to:

Overseeing, coordinating and managing the development of local content; Preparing guidelines to include targets and formats for local content plans and reporting; Making appropriate recommendations to the Commission for smooth implementation of the Regulations; Setting minimum standard requirements for local content in local content plans where applicable; Undertaking public education; Undertaking local content monitoring and audit; and Performing other functions conferred on the Committee by the Commission in accordance with the provisions of applicable laws. The Committee is further required to submit quarterly reports of its activities to the Commission.

Local Content Defined

Regulation 49 of L.I 2204 defines Local Content as: -

"the quantum or percentage of locally produced materials, personnel, financing, good and services rendered in the petroleum industry value chain and which can be measured in monetary terms".

Ghana's Local Content laws have been perceived as a barrier for foreign investors, international oil and gas operators and international oil services companies seeking to do business in Ghana. However, the Local Content policies were not created to be inflexible protectionist barriers that discourage competitiveness.

Instead they are meant to simulate growth in the upstream industry and ensure that Ghanaian citizens profit from the rich oil and gas resources.

Employment and Training of Ghanaian Citizens

The petroleum laws of Ghana require petroleum players in the industry, be it Contractors, Sub-contractors, Licensees and other allied entity engaged in petroleum activities to as far as possible offer employment opportunities to Ghanaians with the requisite skills, expertise and experience.

Regulation 17 of L.I 2204 provides a comprehensive approach to opening up employment opportunities to Ghanaians with the requisite...