Contractors in oil and gas sector must now settle invoice payments within 45 days

The Secretariat reminded that under the Local Content Act, it is required that the contractors and sub-contractors’ Procurement Sub-Plan include a supply chain management strategy, which should promote local suppliers’ competitive financing and growth with appropriate contract and payment terms.

Contractors in oil and gas sector must now settle invoice payments within 45 days

The Local Content Secretariat today announced that it has started advanced discussions on the protracted payment periods for suppliers of goods and services in the oil and gas sector, and building of the capacity of suppliers.

The Secretariat reminded that under the Local Content Act, it is required that the contractors and sub-contractors’ Procurement Sub-Plan include a supply chain management strategy, which should promote local suppliers’ competitive financing and growth with appropriate contract and payment terms.

The provision was created to ensure that Guyanese nationals and Guyanese companies generate capital to expand while becoming competitive and financially independent. 

With the Government and the private sector examining a thirty-day payment period for Guyanese and Guyanese businesses which supply goods and services to the nation’s petroleum sector, Contractors and sub-contractors have been written to, with instructions for them to implement an amendment to their five-year Local Content Master Plan. 

The updated five-year plan must now include a payment period of between 30-45 daysupon the correct receipt of an invoice.

The Local Content Secretariat believes that move will allow Guyanese companies timely and appropriate access to contract and payment terms that facilitate competitive funding and expansion.

The secretariat added that contractors and sub-contractors have shown their willingness to cooperate with this new requirement and have already moved to make the amendment to their Master Plans.

“Suppliers must know that the onus is now on them to submit correct invoices. To see that this is achieved, the Secretariat continues to encourage contractors and sub-contractors to conduct continuous training and suppliers’ engagement forums. These forums will be aimed at upskilling suppliers in areas of the correct preparation of invoices and tenders, and to be appraised of any upcoming procurement opportunities offered by the companies”, the statement said.

Suppliers who continue to encounter issues with the prolonged issuing of payments are asked to contact the Local Content Secretariat.

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