The Local Content Bill 2016 Public Debate Highlights
Strathmore University Extractives Industry Centre (SEIC), under Strathmore Law School, hosted a public debate on the Local Content Bill 2016. The Bill Championed by the Baringo Senator Hon. Gideon Moi, Chairman of the Senator Committee on Energy, seeks to promote maximization of value-addition and the creation of employment opportunities in the extractives industry value chain through local expertise goods, services, businesses and financing, and their retention in the country.
Oil and gas companies will now be required to state how local communities will benefit from the proceeds of mining activities, before they are licensed, if the proposed bill becomes law. Communities in mineral rich areas are set to benefit from this new proposal that imposes strict requirements on mineral operators while giving locals a greater say over their resources.
The Chief Guest, Hon. Gideon Moi highlighted the fact that Kenya is yet to reach a point of competing with the world, and due to this, Kenyans need to maximize on benefiting from their own resources. Thus Hon. Gideon Moi stated that We have not yet reached a point where we can compete on the world stage. Therefore, we must do all we can to ensure the resources beneath our soil benefit us.’
During the public debate a panel discussion was held consisting of Hon. Gideon Moi and: Dr. Melba Wasunna Director, Strathmore University Extractives Industry Centre who was the coordinator and moderator of the discussions: Martin Mbogo – Chairperson & County Manager, Kenya Oil and Gas Association: Martin Heya Commissioner, Petroleum under the Ministry of Energy & Petroleum: Ikal Angelei – Executive Director, Friends of Lake Turkana: Patrick Obath – Associate Director Adam Smith International: and Wanjiku Manyara – Chairperson and CEO, Petroleum Institute of East Africa.
The importance of hiring Kenyans instead of expatriates was the main topic of discussion during this panel discussion. Once the bill is passed into law, international mining companies would be required to commit to a skills and technology transfer agreement with local firms and individuals.
The implementation of this bill will also mean that one will not be allowed to set up shop without clear terms on how his activities will impact land owners and the original owners of the resources, who have in the past been kept on the sidelines of economic development while large firms prosper from mineral proceeds. It also means that communities will no longer be shortchanged by large firms that earn huge profits, while ignoring the welfare of their hosts and other key factors such as the environment.
An operator will be required to prepare and submit to the committee a local content plan with respect to the extractive activities in the prescribed form, before applying for or bidding for, a license or permit, or before expressing interest or engaging in any extractive activity.