Tanzania: Oil companies reject proposed local content regulation; allege it will be costly be implement
"Tanzania oil and gas companies reject local content regulations"
Differences between Tanzania and oil companies over local content obligations contained in Petroleum Act 2015 have resurfaced with the government collecting stakeholders’ views in efforts to enforce regulations. The companies through their organisation, Oil and Gas Association of Tanzania (Ogat)...The companies rejected the draft regulations, saying were costly. “Our aim is to help the government come up with a realistic regulation on local content. All the concerns are taken into account in the process, backed by an extensive study on best practices,” Halfani Halfani, a senior official with Ophir Energy, a UK-based oil and gas exploration company, said.
The draft regulation lay down procedures to be followed by foreign companies to guarantee compliance with local content requirement. According the proposed regulations, before engaging in any petroleum-related activity, a contractor must submit a local content plan for approval. The plan must have details of employment, training, succession plans, research and development, procurement of goods and services and technology transfer. The regulations also call for submission of quarterly implementation reports. “If the regulations are implemented, companies will be spending most of their time focusing on meeting requirements for local content compliance at the expense of their primary undertakings,” said Mr Halfani. “It is actually like the government managing the day-to-day activities of oil companies.” He noted that the draft local content regulations unfairly target foreign oil companies.