Guyana could earn US$250M – US$500M from GtE Project – VP Jagdeo

The Guyana Government anticipates that its model Gas-to-Energy (GtE) Project could earn the country as much as US$500 million from savings when electricity prices are slashed by half and from the sale of the rich excess gas.
This is according to Vice President Dr Bharrat Jagdeo, during a press conference on Thursday.
Located at Wales, West Bank Demerara (WBD), the GtE Project includes the construction of an Integrated Natural Gas Liquid (NGL) plant and a 300-megawatt (MW) combined cycle power plant utilising the rich natural gas from the offshore operations in the prolific Stabroek Block.
When the power plant becomes operational, which is slated for early 2025, it is expected that the addition of 300MW into the national grid will not only bring stable power but also cut the current high cost of electricity by half.
According to VP Jagdeo, this reduction would see savings to the tune of US$250 million per year.
“That is simply because we’ll reduce electricity prices from 22 cents per kilowatt-hour (kWh) to 11 cents per kWh. So, US$250 million per year in savings to the people of Guyana,” he stated.

The Vice President further explained that with this saving, it would take Guyana approximately eight years to repay for the entire GtE Project, which is pegged at almost US$2 billion including the cost of the US$1 billion pipelines installed by US oil major and Stabroek Block operator, ExxonMobil, that will be used to bring the gas onshore.
However, Jagdeo pointed out that the liquids that will come when Guyana cleans the excess gas for products such as cooking gas or Liquefied Petroleum Gas (LPG) can be sold and this will further bolster the country’s earnings from the GtE Project.
“The liquids alone that we will get from the project, if we sell it at current market price in Guyana, the same amount of liquid will raise another US$250 million per year…. So, it’s a massive [earning]. We will see about US$250 to US$500 million per year in benefits from that because we now have free electricity [and liquids to sell]. That’s a huge sum of money,” the VP stressed.
At least 50 million standard cubic feet of gas (mmscf) are expected to be piped from the Liza Field in the Stabroek Block to the GtE Project site at Wales.
In the Stabroek Block, some 17 trillion cubic feet of gas has already been found with the Pluma and Haimara wells being proven gas fields.
But the 250 kilometres of 12-inch pipelines that were laid by Exxon to bring the gas onshore will only use 40 per cent of the pipeline’s capacity to gas up the Wales project, bringing 50 million standard cubic feet per day (mmscfd) of dry gas onshore.

But with the pipelines having the capacity to push as much as 120 mmscfd of gas, the Government is now moving ahead with Phase Two of the GtE Project that will utilise the remaining 60 per cent capacity of the pipeline and will see an additional 75 mmcfd of rich gas brought onshore.
Invitations are currently out for proposals to design, construct, and operation of a 250 MW combined-cycle power plant, to deliver 2,100 gigawatt/hours (GWh) of electricity per annum, and sell to the Guyana Power and Light (GPL) Inc. It also caters for the design, construction and operation of another NGL facility to produce approximately 6,000 barrels per day of NGL products such as propane, butane, and C5+gasolene.
Additionally, Phase Two also includes the transfer, at no cost, of excess “lean gas” estimated at 30 mmcfd, for utilisation in downstream industries, e.g. fertiliser production, to be located at Wales.
The People’s Progressive Party/Civic (PPP/C) Government has been adamant about utilising the country’s gas resources to advance national development. United States (US) energy firm, Fulcrum LNG Inc, has been selected to work in a tripartite arrangement with the Guyana Government and ExxonMobil to develop a potential gas project.
Meanwhile, when it comes to the 300MW power plant and NGL facility, construction is currently ongoing by the US-based consortium of Lindsayca CH4 Guyana Inc. (LNDCH4).
This project is pegged at US$761 million and the Guyana Government had approached the US Export-Import (EXIM) Bank for financing. The EXIM Bank Board, last month, granted initial approval of approximately US$500 million for the GtE Project. The loan was sent to the US Congress for feedback before final approval was given by the bank.
In the meantime, the Guyana Government has already injected some US$400 million to commence work on the highly anticipated GtE initiative and VP Jagdeo had previously stated Guyana could potentially fund the entire initiative had the loan request not been approved by the US financial institution. (G-8)