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Oil and gas SMEs complain of foreign dominance

oilSmall and medium enterprises (SMEs) operating in the oil and gas industry are complaining that foreign companies have taken over the supply of goods and services to the major international oil companies (IOCs).

Currently, within the oil and gas industry, foreign companies have dominated since they have been in existence for years and have the experience as well as requisite infrastructure, the SMEs said.

Speaking at a regional workshop and the 9th annual general meeting of the Western and Central Regional branch of the Association of Ghana Industries (AGI), Yen Sapark, Head, Training Development and Research of the Enterprise Development Centre (EDC) in Takoradi, said: “How many SMEs can keep records for over 20 years and beyond? That is one of the reasons why we have dominance of global companies over local supply chains because we cannot provide quality goods and services on time and in compliance with strict environmental and working standards.

Speaking on the theme “Identifying Opportunities, Processes and Removal of Bottlenecks and Challenges of Outsourcing to Local, Ghanaian SMEs: The Case of the Oil and Gas Industry in Ghana”, he noted that local firms do not know about the inherent opportunities in the industry.

On the issues of standards and quality, he noted that the local companies are confronted with concerns about the environmental integrity of their work among other challenges.

According to him, local firms are required to accommodate the IOCs’ concerns on safety and working practices. However, he noted that there is inadequate financing of local firms in the country as well as lack of dedicated oil and gas desks in the banking sector.

He pointed out that foreign companies have credit facilities extended to them, but the local SMEs fear to invest with the mind that “what if I invest and it fails?”

On the way forward, Mr. Sapark said SMEs should check for compatibility, technical expertise requirement, knowledge transfer expectations among others when bidding for contracts in the industry.

Again, he said there should be the establishment of a supplier finance facility to help boost SME development in the oil and gas industry, while SMEs should pursue international certification necessary to work for the IOCs.

“The Ghana National Petroleum Company (GNPC) Oil and Gas Foundation has been launched and there is the need for Ghanaian SMEs to take advantage of it since it is a facility that ‘ will expand research and also build the human resource needed for the sector,” he said.

Currently, about 1,000 Ghanaians have been employed by the IOCs as contractors and sub¬contractors.

Source: B&FT

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Reporting Oil and Gas project was launched on 4th June 2009atTakoradi, Western Region, Ghana by Penplusbytes (PPB – www.penplusbytes.org) with the vision of providing a one stop online information and knowledge about Ghana’s oil and gas sector
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