Govt working aggressively to get gas-to-energy project off the ground next year – Jagdeo

In its quest to provide cleaner and more reliable energy for Guyana, the PPP/C Government has already started working on its gas-to-energy project and is looking to start implementation early next year.
This is according to Vice President Bharrat Jagdeo.

Vice President Bharrat Jagdeo

He told reporters at a press conference on Friday that Government has been defining the parameters and has had several meetings with ExxonMobil.
“Now, I think we’re clearer now on the parameters we want, between 200 to 250 megawatts of power and enough gas to do that and to supply the entire country with cooking gas – LPG (liquefied petroleum gas) in the project that will hopefully move to a project implementation stage soon – early next year – and we’re hoping that we would have a three years’ timespan for that. That will be a major difference in the system because of the price at which it will come in. So, we’re working aggressively on that, that is, to bring in a huge baseload capacity at a lower price that would cause us to change the entire dynamic of electricity production and pricing,” Jagdeo stated.
Currently, with Guyana generating at nearly 17 to 20 cents per kilowatt/hour, this project is expected to cut the cost of electricity in the country by more than half.
Previously, the Vice President had announced that a team was set up to start negotiations on the gas to energy project.
Jagdeo had noted that Government is still making a decision on whether it will buy the power or generate it.
“We have to see the cost of both to determine whether Government can fund this or not. If the Government cannot fund it, we will go out to tender for people to build this facility but tie them into a price for the electricity – a low price for the electricity… and to the extent that gas is cheap, that price will even come down further,” he had explained.
Already, the PPP/C Administration has stipulated stiff fines and penalties in the Payara Licence against flaring of excess natural gas – something which Exxon has been flagged for doing in the Stabroek Block.
Exxon itself has said that the gas that would be required for the gas-to-shore project is available. Estimates have put the figure required for the gas-to-shore project at 30 to 35 million cubic feet of natural gas.
Previously released data from Norwegian research company Rystad Energy on Guyana had indicated that a little less than 20 per cent of the 1.8 billion Barrels of Oil Equivalent (BOE) discovered last year was gas.
The Haimara discovery made by Exxon last year was found to have 207 feet of high-quality gas condensate sandstone reservoirs.
But for reasons unclear, little progress was made by the previous A Partnership for National Unity/Alliance For Change (APNU/AFC) Government on the gas-to-shore project.
There had only been talk of natural gas and liquid petroleum plants, with the pipe carrying the gas to shore at a location along the East Coast of Demerara (ECD) and the power being integrated into the Guyana Power and Light (GPL) grid.
Only recently, oil and gas expert Arthur Deakin posited that the Government’s ambitious gas-to-shore energy project will be a crucial one for Guyana’s energy sector.
In an exclusive interview with this publication, Deakin, who is an Analyst at Americas Market Intelligence, explained that breaking Guyana’s dependence on heavy fuel oil (HFO) by integrating renewable energy into the grid is essential to lowering energy costs.
“I think the gas to shore project that they’re contemplating now from the associated natural gas coming from the Stabroek Block, developing that pipeline to transport that natural gas into a state-of-the-art pipeline, is going to be very important to diversifying the energy grid,” Deakin explained.
“Guyana, as you know, is very dependent on importing heavy fuel oil, which makes its electricity cost one of the highest in the region. So just by using this resource which will be available on extraction, will be fundamental to lowering energy costs and making the energy system more reliable.”
But Deakin warned that while natural gas is a good solution, it is not the only solution.
However, the PPP/C Government has already said it will keep developing other renewable energy solutions. (G8)