By Svetlana Marshall
The US$2 Billion Gas-to-Energy Project, which includes a 300MW Power Plant and Natural Gas Liquids (NGL) facility at Wales, will face additional delays, according to Government Consultant, Winston Brassington disclosed today.
As he addressed oil and gas experts and industry leaders at the Guyana Energy Conference this morning, Mr. Brassington explained that while the US$1Billion pipeline was completed on budget, and on time by ExxonMobil Guyana, the construction of the Power Plant and Natural Gas facility has encountered some challenges.
The pipeline component includes a 250-kilometre 12-inch pipeline from two Floating Production, Storage and Offloading platforms (FPSOs) that would deliver some 50 MCF/D (1,000 cubic feet per day) of gas to shore.
“The pipeline is completed. It is being filled with nitrogen, pressurized and waiting on the power plant to be completed, and then the nitrogen will be switched to the gas. So, I am please to say that was completed on schedule and within the budget. That figure of a US$1B, that is the figure, and it will not go above that. On the integrated facility, contractually, this is scheduled to be delivered in the second half of this year but we have seen a schedule that suggests it will take longer. Contractually, this year, realistically, we are looking at some delays,” Mr. Brassington explained.
Both the Power Plant and the NGL facility are now expected to be completed between the second half of 2025 and the first half of 2026.
Though not providing the particulars, Brassington said the expected delay is as a result of a number of disputes.
The contractor, Lindsayca/CH-4, had moved to a Dispute Adjudication Board after it could not resolve a stalemate with the Government of Guyana over the sum of US$50 million that the company claimed it is owed because the project site was delivered to it three months late.
The Dispute Avoidance Adjudication Board has handed down its decisions, but particulars of the decision have not been disclosed.
The third component of the gas-to-energy project, which involves the erection of transmission lines and substations has also encountered delays, largely due to setbacks in the land acquisition process, it was explained.
However, Brassington said major portions of the 69KV lines have been completed by the contractor – Kalpataru.
“So, from Vreed-en-Hoop all the way up to Wales, the new 69KV transmission system is completed. By the end of the first quarter of this year, they are looking to complete the entire transmission lines, and by the second quarter to complete, all of the substations,” the Government Consultant said.
The construction of the National Control Centre – the fourth component of the project – is moving a pace, and is on track to be completed on time by the second half of this year.
Brassington told the conference that when completed, the Gas-to-Energy Project will have two primary revenue streams – the NGL Plant and the 300MW power plant – making it very feasible.
“We will have for the liquids over 63 million gallons per annum, that’s about 4,100 barrels of liquids per day. And as mentioned, the country uses less than a 1000 barrels per day, and so most of this will likely be available for the export market. And that’s going to be a key revenue earner. And then of course, all of the gas on phase one is going into power, electricity, the 300MW combined cycle. That could give us over 2600 kwh per annum of energy,” he explained
He said past feasibility studies projected that the lowest generation price was 7.5 US cents per kwh. However, Brassington said Cabinet just recently approved a Power Purchase Agreement between Guyana Power and Gas Inc, that will own and operate the facilities, and the Guyana Power and Light (GPL), that would not exceed 5 cents per kwh. He said there is room for the price to be further reduced.
The Government has said that when completed, the project’s benefits will include a doubling of the country’s electricity generating capacity to meet growing demand and a reduction in the cost of generation, thereby enabling electricity prices paid by consumers to be cut by 50 per cent.
At last year’s energy conference, Brassington had given a mid-2025 completion time for the project.
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