While the US Exim Bank is yet to green light a US$660 million loan to support the government’s Wales Gas-to-Energy project, Vice President, Dr. Bharrat Jagdeo assured that all expenses will be handled in the interim by the Treasury. During a press engagement at Freedom House yesterday, the Guyanese official assured that the project is still on track for 2025, irrespective of those spreading “doom and gloom”.
His comments were made as part of a methodical dissection of a Stabroek News editorial, which said the project could be another failed initiative. The piece that was published on January 6, 2024, states: “The project the nation should be most concerned about is the Wales Gas-to-Energy project. This is because of the massive expense involved – US$759M for the plant itself, an additional $1B for the pipeline, and US$159M for transmission upgrades.”
Jagdeo refuted the editorial’s position that the project is behind schedule with the median estimate for completion being 2026. The Vice President told journalists that the timeline has been affected “but it’s not because of anything (untoward) except, the handing over of the site was later than anticipated…” He maintained that the timeline remains 2025.
As for the editorial’s presumption that the project could be held up since the US Exim Bank is yet to approve the US$660M loan, Jagdeo said this is misguided reasoning.
“The loan hasn’t been approved, but we are paying from the Treasury. We are meeting all of our commitments to the contractor (US-based partnership CH4/Lindsayca) . We haven’t stalled the project or said to hold on the project until the loan is approved,” he said.
He reminded of his previous position that the loan will be approved based on communications with top brass at the bank. “But it will be retroactive financing,” he said, adding that the government has access to alternative forms of bridge financing if needed.
With respect to the National Gas Strategy, which will concretize Guyana’s roadmap for developing its gas resources, he said this will be finalized and released soon. He noted that a Request for Proposals will be issued in the coming days for consultants to share how Guyana can best monetize gas from the Stabroek Block. Jagdeo said this will also entail outlining the way forward for utilizing excess gas from the Yellowtail Project which comes on stream next year.
The US$10B Yellowtail Project represents the fourth oil development in the ExxonMobil-operated block. It is poised to generate 450 million standard cubic feet of gas per day by 2025-2026. Exxon had warned in its Environmental Impact Assessment for the project that there would not be enough demand in Guyana to consume so much gas.
ExxonMobil said Guyana can consider export options. It further noted that space reservation and basic design connections to allow for this are included in the project scope
