-gov’t optimistic multimillion-dollar loan will be approved to support works, Jagdeo says

THE Government of Guyana is optimistic that a multimillion-dollar loan will be approved for the Wales Gas-to-Energy project, according to Vice-President Dr Bharrat Jagdeo.

Dr. Jagdeo, during his weekly news conference, told reporters that United States (US) officials have signalled their support for the project which aims to decrease the country’s energy cost.

“Every US agency, including on a bipartisan basis [and] members from both sides of Congress assured us that this project is a great project. It will receive their full support so it is just that you have to go through the technical process. Jagdeo said.

Earlier this week, VP Jagdeo, along with the country’s finance minister, Dr. Ashni Singh, met with executives of the Export–Import Bank of the United States.

Dr. Jagdeo said that technical officials are currently processing all the necessary approvals needed.

“Normally when you apply for a loan, the agency does its own internal assessment of the engineering. It’s like if you borrow money from any bank, if you go to the World Bank, IMF, etc., they have to be assured that it’s a sound project.”

He noted that consultants have been hired and are continuously working.

“The consultants were hired by EXIM Bank. They have been doing their work; they are about to complete their work most likely in January. Thereafter, it has to go through a process. It will have to go to the board and then it will go through. I think it’s about 45 days of notification of Congress and then thereafter, they can have the final board approval. So, it is a process; people think that when you make an application, it’s immediate. These internal processes take some time.”

The gas-to-energy project will see a 200km 12-inch diameter pipeline channelling natural gas from the Liza Phase One and Liza Phase Two Floating, Production, Storage, and Offloading (FPSO) vessels to a power plant and Natural Gas Liquids (NGL) facility that will be built in Wales, on the West Bank of Demerara.

ExxonMobil’s local affiliate, Esso Exploration and Production Guyana Limited (EEPGL) – the operator in the Stabroek Block, and its co-venturers are constructing the pipeline.

That pipeline will be landing on the West Coast Demerara shore and will continue approximately 25 kilometres to the NGL and power plant facilities. It has an estimated cost of US$1 billion and is cost-recoverable.

The power plant and NGL facilities will be funded by the government.

Last December, the Government of Guyana and US-based integrated energy solutions group – LINDSAYCA – in partnership with a local firm – CH4 Group – signed a US$759 million contract for the construction of the facilities.

The conversion of natural gas from ExxonMobil’s offshore operations to electricity is a key component of the People’s Progressive Party/Civic (PPP/C) government’s objective to lower energy costs by at least 50 per cent, through an energy mix which incorporates gas, solar, wind, and ‘hydro’ power.
Meanwhile, the oil and gas giant, ExxonMobil, has made significant strides in installing the infrastructure that is needed to support the ambitious project.

The company has successfully undertaken site clearing and preparation of a substantial 100-acre area, which will serve as the foundation for the integrated plant.