Gas-to-shore, Amaila Falls Hydro projects to facilitate industrial revolution in Guyana – Dr Ashni Singh

With Guyana on the cusp of a massive economical and infrastructural transformation, the highly anticipated Gas-to-Shore and Amaila Falls Hydropower Projects (AFHP) are expected to lead the path towards an industrial revolution in the country.

This is according to Senior Minister with Responsibility for Finance, Dr Ashni Singh, during his presentation to wrap up last week’s debates on Budget 2022.
The $552.9 billion Budget, under the theme “Steadfast Against All Challenges, Resolute in Building Our One Guyana”, will lay the foundation for Guyana’s massive economic transformation and modernization. It also contained the use of the country’s earnings from the oil and gas sector for the first time to finance several major development projects including the Gas-to-Shore and Amaila Falls projects.
Dr Singh this budget outlines an agenda for transforming Guyana in a way that generations of Guyanese have been waiting for. He noted that the energy sector will be the driving force behind this transformation.
“The Gas-to-Shore project and the Amaila Falls [will] deliver energy at scale, using clean and renewable sources including gas a transitional fuel… delivering electricity at the level that is required to facilitate an industrial revolution in Guyana. Finally, the industrial revolution that our fore-parents have dreamt of but were unable to realise because of inadequacy and cost of power; finally, this People’s Progressive Party government will deliver it and Budget 2022 initiates that delivery,” the Finance Minister declared in the National Assembly on Friday last.
In its shift to renewable energy, the Dr Irfaan Ali-led administration is pursuing a diverse energy mix that includes hydropower, solar power, wind power, and the transition from fossil fuel to natural gas as a much cleaner option. To this end, a total of $29.4 billion is allocated to the energy sector in Budget 2022.
The PPP/C Government is pursuing the US$900 million game-changing initiative that will see gas from the Liza Field in the Stabroek Block offshore Guyana being piped onshore to generate power.
The main objective of the project is to transport sufficient gas from the offshore oil operations to supply some 200-250 megawatts of energy to the national grid by 2024, leading to a significant reduction in electricity costs. It entails the construction of a 225 km pipeline to transport the guaranteed minimum of 50 mmcfd of natural gas from offshore Guyana to the Wales Development Authority, West Demerara.
Only last month, it was disclosed that some 13 companies have applied to construct the natural gas-fired power plant and the natural gas liquids plant components of the project.
The National Procurement and Tender Administration Board (NPTAB) opened 12 bids from local, regional and international firms.
Among the companies whose Expressions of Interest were deemed acceptable enough to now enter the prequalification process, were CH4 Guyana Incorporated in collaboration with Lindsayca Incorporated, a Texas-based company.
Power China International Group Limited, a company that specialises in hydropower and electrical infrastructure, was also prequalified, as well as China Energy International Guyana Company Limited. China Machinery Engineering Corporation (CMEC) was also prequalified.
Other companies include Apan Energy, Wilson Offshore and Marine Limited, Constutora Queiroz Galvao, Tecnicas Reunidas, Black and Veatch, Amerapex Corporation (USA), SEPCOII Electric Power and Trinidadian company NGC Group.
The rationale for the combination of the power plant and the NGL facilities is guided by findings by Esso Exploration and Production Guyana Limited (EEPGL) – the local subsidiary of ExxonMobil – that there will be substantial savings from combining these two facilities.
As such, notwithstanding that the Government of Guyana has separately received Expressions of Interest in September 2021 that included the power plant, and that EEPGL had separately pre-qualified firms for the NGL plant, the decision to combine the power and NGL plants necessitated that all interested parties be invited to submit or re-submit the information.
Meanwhile, the construction of the Amaila Falls Hydropower Project, which is projected to generate some 165 megawatts of electricity, is set to begin this year and be completed by 2027.
As a result, the Government has allocated a total of $29.4 billion to the energy sector in 2022.
The Finance Minister had said in his Budget presentation two weeks ago that Government has requested, received, and evaluated proposals for this project, adding that negotiations are underway with the highest-ranked company which is an experienced international company.
“The project will be developed under a Build-Own-Operate-Transfer (BOOT) arrangement within which the Guyana Power and Light Incorporated (GPL) will purchase power from the operator under a Power Purchase Agreement (PPA)… Once operationalised, the facility will significantly reduce the cost of energy for both businesses and households,” Dr Singh said in his speech.
The AFHP initiative, which was created by the previous PPP/C government, was scrapped by the APNU/AFC regime after they took office in 2015.
The PPP/C had promised to revive the project on the 2020 campaign trail.
In fact, these two flagship projects are key features of the PPP/C’s revised Low Carbon Development Strategy (LCDS 2030) which is aimed at transforming Guyana’s energy landscape with the aim of ensuring that the nation is fully powered by affordable and non-polluting power in the next decade.