Gas-to-Energy partners split better for project completion – VP Jagdeo

…says deadline, US EXIM bank loan unaffected

Following the news of the contractor for the Gas-to-Energy (GtE) Project, Lindsayca CH4 Guyana Inc. – a United States-based consortium of Lindsayca and CH4 – deciding to split, Vice President (VP) Bharrat Jagdeo says this could augur well for the highly anticipated initiative and could see the works being fast-tracked.
Earlier this week, it was reported locally that Lindsayca and CH4 were parting ways over financial issues. This separation, according to reports, would see Lindsayca becoming the 100-per-cent shareholder with full responsibility for the completion of the GtE project.
Questioned about the split during a press conference on Thursday, Jagdeo explained that the government was informed that the internal woes between the joint venture (JV) partners were affecting the progress of the project.
As such, he surmised that the breakup would be a positive outcome in achieving the revised mid-2026 deadline for the project completion.
“We’ve been hearing about the breakup of the consortium, and we’re told that is to facilitate – because they have internal issues – to facilitate completion of the project by that deadline. [It] would allow them to accelerate the work because it seems as though the internal rambling between the companies is affecting the pace of implementation of the project. So, I’m told that it’s a positive thing that is happening, but the technical people have to examine that,” the VP stated.
According to Jagdeo, the government has been assured by its project leads that even with the split, the GtE project is still on schedule to meet the timeline of mid-next year.
In addition to the deadline being unaffected, the separation will also have no consequences on the US$527 million loan that Guyana secured from the US Export-Import (EXIM) Bank to partially fund the project.
“So, it will not impact the loan… because it still remains a US company… The loan is to the Government of Guyana… And we believe the company’s proposal to split is to ensure faster movement of the project,” the VP assured.
The US$759 million project, which will utilise gas resources that will be piped from offshore, will see the construction of a 300-megawatt (MW) Combined Cycle Power Plant and a Natural Gas Liquids (NGL) facility built at Wales, West Bank Demerara (WBD).
It is expected that once power starts to be delivered next year, Guyanese will see the cost of electricity slashed by half and also benefit from a reliable electricity supply.
In addition to the US EXIM Bank loan, the government has also set aside some G$51 billion in the 2025 budget to advance works on the project.
The LNDCH4 consortium was awarded the US$759 million contract in November 2022 to build the power plant and NGL facility at Wales. In fact, the highly anticipated GtE Project was initially slated to come on stream by April this year. However, the Guyana government has been engaged in a dispute with the project contractor, LNDCH4, which has made financial claims and a deadline extension.
These claims stem from the late handing over of other aspects that affected the work of the contractor, which had filed financial claims to the tune of US$50 million and sought a six-month extension to the deadline over the delays – both of which were rejected by the Guyana Government, thus leading to a dispute resolution process that was activated.
Following a Dispute Avoidance and Adjudication Board (DAAB) process to settle the matter, both Guyana and the GtE contractor decided back in March of this year to go to full arbitration.
The arbitration will be administered by the International Chamber of Commerce (ICC), with Washington, D.C., selected as the venue. It is unclear what stage this proceeding is at. The government had previously noted that pursuant to the International Federation of Consulting Engineers’ (FIDIC’s) DAAB procedures, all DAAB decisions in this matter are confidential.
Notwithstanding the disputes, both the Guyana Government and LNDCH4 had emphasised the strategic importance of the GtE project to the Guyanese economy, and works are ongoing at the site.