President, Irfaan Ali announced on Thursday that Cabinet has granted its no-objection to CH4/Lindsayca, an American-Guyanese joint venture to build a 300-megawatt combined cycle power plant and a natural gas liquids plant at Wales, West Bank Demerara. Both are fundamental aspects of the imminent gas-to-energy project.
The Head of State said Cabinet’s no-objection will allow negotiations to conclude an Engineering, Procurement, and Construction Contract. Ali said Power China was ranked number two and may be engaged if negotiations fail to conclude with Lindsayca by end of November.
Ali recalled that earlier this year, nine firms were publicly pre-qualified to bid on an EPC contract. He said a Request for Proposals (RFP) was issued to these pre-qualified bidders. At the closing date of September 13, 2022, Ali said five bids were received. They are as follows: Guycan Consortium – US$549,088,000, China Energy Int’l Group Co. Limited – US$466,649,772, China Machinery Engineering Inc. – US$696,001,776, Power China Int’l Group Limited – US$703,652,256, and Lindsayca Inc. in a joint venture with CH4 Guyana Inc. – US$898,764,244.
He said these bids were evaluated for technical compliance and ranking by Stantec and Worley, two global engineering firms with expertise in oil and gas.
Based on the reports of these international firms, the President said an evaluation team of three people, including a representative of Exxon, was appointed. On the basis of the bids submitted and clarifications received, the team unanimously ranked CH4/Lindsayca as number one, and Power China as number two.
He said key considerations in the evaluation took account of the expected date of delivery of the 300 MW power plant by December 2024. Ali said both top-ranked companies confirmed this deadline.
Furthermore, the EPC contract will be supervised by a global supervision firm, Engineers India Limited.
Guyana Standard previously reported that the 300 MW power plant and NGL plant will be owned by the Government of Guyana.
Prior to the conclusion of the construction, an international firm will be competitively selected to operate the project to international standards and best practices.
Exxon is also expected to deliver the completed pipeline to the power plant by the fourth quarter of 2024, to achieve commissioning and testing by the end of 2024.
The Gas to Energy Project is expected to deliver power at less than half of the current cost. The government has said that project generation costs, taking account of payment for the pipeline, operations and maintenance (O&M), and capital cost recovery, shall total less than five (5) US cents per kilowatt-hour.
Ali in his remarks today said, “…this is a significant movement forward in Guyana, not only achieving energy security, but us achieving an important benchmark that is a reduction in our energy costs so that our manufacturing and industrial development and expansion can take place and so that the ordinary families and the ordinary people can feel a substantial reduction in the cost of electricity in their pockets and in their household. Just for reference, a family at the end of this project that now pays GY$20,000 per month in light bill or electricity costs will see that costs coming down to GY$10,000.”
In light of the foregoing benefits, the President said he is therefore pleased to make the announcement following the immediate award of Cabinet’s no-objection.
