Local Content in Practice: Improving the Participation of South Sudanese in the Petroleum Industry

Local content requirements promote national capacity, employment, economic diversification, and economic growth (Kazzazi and Nouri 2012, Tordo et al., 2013). Local content develops capacities that link the oil and gas sector to other industries. While over 80% of the oil and gas sector’s workforce is South Sudanese, little is known about their earning levels, experience, and educational attainment, compared to their expatriate colleagues (Tiitmamer, 2015). This paper analyzes human resources data from two of the joint operating companies and determines how the South Sudanese compare to the expatriates. Second, the paper reviews the local content clauses to determine possible gaps in an effort to inform amendments stipulated in the Revitalized Agreement for the Resolution of Conflict in the Republic of South Sudan (RARCSS). The study reveals several insights with public policy relevance. First, nearly 90% (87.95%) of the oil and gas sector employees are South Sudanese. Second, expatriates, many of them Chinese, earn an average of $29,312.56 per month, compared to just $1,858.11 (6% of total income) for an average South Sudanese. Third, expatriates are extremely averse to sharing data on prior experience, education, and other professional qualifications, complicating comparisons with the South Sudanese workforce. This raises questions about the good will of oil and gas sector partners in the country. Finally, the Petroleum Act, 2012 inadequately addresses the local content matters, lending the oil companies leverage to exploit the South Sudanese. These findings support a call for immediate action, including developing strict enforcement and monitoring mechanisms and amending the Act.