Cheaper electricity imminent
President, Dr. Irfaan Ali
President, Dr. Irfaan Ali

–as Cabinet grants approval for construction of 300-megawatt power plant at Wales

PRESIDENT, Dr. Irfaan Ali, on Thursday, announced that Cabinet has given its no objection to CH/4Lindsayca for the construction of a 300-megawatt gas-to-power plant at Wales, West Bank Demerara.

The Head of State made this announcement via a live-streamed video message following a Cabinet meeting on Thursday afternoon.

He related that CH4/Lindsayca was ranked number one to construct the 300 MW combined cycle power plant and natural gas liquids (NGL) plant at Wales.

Dr. Ali went on to say that Cabinet’s no objection paves the way for negotiations to proceed to conclude an Engineering, Procurement and Construction Contract (EPC) contract. Should the negotiations fail to conclude a contract by the end of November, he added that Power China might be engaged.

Some nine firms were, earlier this year, prequalified to bid on the EPC contract and a Request for Proposals (RFP) was issued to the prequalified bidders. At the closing date of September 13, some five bids were received.

The bids, Dr. Ali said, were evaluated for technical compliance by two global engineering firms with expertise in oil and gas, Stantec and Worley, along with an evaluation team of persons including a representative of ExxonMobil.

The team performed the evaluation in accordance with the technical and economic criteria which were set out in the RFP.

President Ali remarked that it was on the basis of the bids submitted, along with the clarifications received, that the team unanimously ranked CH4/Lindsayca as number one and Power China as number two.

The intended gas to shore project

“Contract negotiations will now start with the expectation that a contract will be executed before the end of November,” President Ali said.

Among the key considerations in the evaluation was the expected delivery date of the 300MW power plant by December 2024, which both of the top-ranked companies confirmed as the deadline.

While the deadline has been set, the EPC contract is expected to be supervised by a global supervision firm, Engineers India Limited.

The Head of State said that the power and NGL plant will be owned by the Government of Guyana and prior to the conclusion of construction, an international firm will be selected to operate the project to international standards and best practices.

ExxonMobil is expected to deliver the completed pipeline to the power plant by the fourth quarter of 2024, in order to have commissioning and testing of the 300 MW power plant by the end of 2024.

“The gas-to-energy project is expected to deliver power at less than half of the current costs.  Project generation costs, taking account of payment for the pipeline, operations and maintenance (O&M), and capital cost recovery, shall total less than five US cents per kilowatt-hour,” Dr. Ali related.

He went on to say that it was a significant step forward for the country, as it sets the stage for the nation to achieve energy security and a reduction in energy costs for the expansion of the manufacturing and industrial sectors.

“The ordinary families and the ordinary people can feel a substantial reduction in the cost of electricity in their pockets and in their households. Just for reference, a family at the end of this project that now pays $20,000 per month in light bill or electricity costs will see that cost coming down to $10,000,” the Head of State said.

In the initial project summary, which was submitted in 2021 to the Environmental Protection Agency, ExxonMobil Guyana said that the project is expected to be executed in several phases.

The project will see the construction and operation of a pipeline from the Liza Phase One and Liza Phase Two Floating, Production, Storage and Offloading (FPSO) vessels to an onshore NGL and Natural Gas processing plant.

The document noted that this pipeline will transport approximately up to 50 million standard cubic feet per day of dry gas to the NGL plant.

According to ExxonMobil, the construction of the plant is expected to create at least 600 jobs.

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