Govt extends deadline for Gas-to-Energy Phase II proposals

…prospective investors now have until January 2025

The deadline for bidders to respond to the government’s Request for Proposals (RFP’s) for Phase two of the Gas-to-Energy project, has been extended to January 2025.

Phase two of this transformative project, being administered under the Office of the Prime Minister, includes the design, construction, and operation of a 250 MW combined-cycle power plant, to deliver 2,100 Gigawatt/hours (GWh) of electricity per annum, which will be sold to the Guyana Power and Light (GPL) Inc.
According to the amended RFP, bidders now have until January 14, 2025, to submit their proposals, together with project schedules, information on their local content plans should they get the greenlight for the project and a breakdown on their Engineering Procuring and Construction (EPC) pricing structure.
It is envisioned that investors in phase two, will be able to recover their investment over a negotiable 20-to-25-year period Power Purchase Agreement (PPA). At the end of this term, the facilities will revert to the Government of Guyana “at no cost”.
Phase two of the project caters for the design, construction and operation of a second Natural Gas Liquid (NGL) facility to produce at approximately 6,000 barrels per day, a range of NGL products that include as propane, butane, and C5+gasolene.
Additionally, Phase II also includes the transfer, at no cost, of excess “lean gas” estimated at 30 million Standard Cubic Feet per Day (MMSCFD), for utilization in downstream industries, e.g. fertilizer production, to be located at Wales.
Based on the RFP document, the Phase II projects will be located on no more than 100 acres of land, immediately adjacent to the existing 300 MW Integrated facility at Wales and will be 100 per cent owned and financed by the private sector – similar to or exceeding the project finance structure of Phase I of the GtE Project.
It was noted that only firms adjudged to be experienced in Engineering Procurement and Construction (EPC) and Financing of comparable facilities, will be evaluated. The Government also said it intends to appoint an independent supervision firm to ensure the project is built per approved contract quality and specifications.
This move to establish a second power plant at Wales is part of the PPP/C Government’s efforts to transition to clean energy, slash the costs of electricity and provide reliable energy sources for the country’s booming economy.
In the Stabroek Block, some 17 trillion cubic feet of gas have already been found, with the Pluma and Haimara wells being proven gas fields. The Guyana Government is seeking to develop this gas.
Back in 2019 and 2023, ExxonMobil drilled for gas at the Haimara-1 and 2 wells, and emerged with varying degrees of success. It was recently revealed that the US oil giant’s drill programme for Guyana for this year and beyond includes plans to further appraise the Haimara 3 and 4 well sites to gauge the commercial potential for gas in the Haimara gas field.
Already, significant progress has been made on the first Gas-to-Energy project, which consists of the construction of 225 kilometres of pipeline from the Liza field in the Stabroek Block offshore Guyana, where Exxon and its partners are currently producing oil.
It features approximately 200 kilometres of a subsea pipeline offshore that would run from Liza Destiny and Liza Unity Floating, Production, Storage, And Offloading (FPSO) vessels in the Stabroek Block to the shore. Upon landing on the West Coast Demerara (WCD) shore, the pipeline would continue for approximately 25 kilometres to the LNG plant at Wales, West Bank Demerara (WBD).
In last year’s national budget, the project received a $43.3 billion allocation in addition to the $24.6 billion injected into the start-up of the transformational project. The Guyana Government has envisioned the startup of the GtE Project by 2025, thus realizing its commitment to deliver cleaner, cheaper, and more reliable energy to the population… particularly since it will slash electricity costs by half.
It was announced in April 2023 that Guyana had applied for the loan from the US Export Import (EXIM) Bank to finance the US$761 million GtE Project. As part of its internal due diligence process, the US EXIM Bank hired two consultants to do the technical assessment of the project.
These works were done during site visits over the past year. In fact, back in June, President Dr Irfaan Ali had revealed that the feedback from those two assessments were positive. He said the teams found “no fatal flaws” from the technical and environmental due diligence work done here. (G3)