Guyanese-owned consortium inks pact to construct US$300M shore base facility for ExxonMobil
– project for late 2023 completion
ExxonMobil Guyana and the Vreed-en-Hoop Shorebase Incorporated (VEHSI) on Friday signed a 20-year agreement for shore base services to be provided at the Port of Vreed-en-Hoop facility to support the US oil giant’s operations offshore Guyana.
VEHSI, which is undertaking Guyana’s first multi-purpose port facility, is a joint venture between a fully-owned Guyanese consortium – NRG Holdings Incorporated, and Jan De Nul Group, a Belgium-based company that specialises in offshore, marine, civil, environment, and project development.
The consortium includes Hadi World Inc, owned by businessmen Nazar “Shell” Mohamed and Azruddin Mohamed, Nicholas Boyer of National Hardware Guyana Limited, and Andron Alphonso of ZRN Investments Inc.
NRG holds a majority stake of 85 per cent in VESHI, while the remaining 15 per cent is owned by Jan De Nul – the company that will construct the facility.
The multi-million Port of Vreed-en-Hoop, which will be located at the Best, West Coast Demerara foreshore, will feature an offshore terminal; fabrication, umbilical and spooling yards; a dry dock facility; a wharf and berths, and administrative buildings, among other facilities.
Company Secretary/Director of VEHSI, Andron Alphonso, and President of ExxonMobil Guyana, Alistair Routledge, signed the 20-year pact, to the tune of US$300 million, on Friday allowing for the US oil major to lease the facility upon completion next year.
According to Routledge, this shore base facility will allow the company to do more construction-related works, such as fabrication, right here in Guyana to support its offshore operations.
He explained that Exxon has already invested in the Guyana Shore Base Inc (GYSBI) which has enabled them to bring the supply chain for drilling operations and production operations into Guyana almost completely out of Trinidad.
“What VEHSI [now] allows us to do is to bring more of the construction activities, the preparation for installation of subsea equipment [to Guyana]. Everybody tends to focus on the vessel that’s on the surface – the FPSOs (Floating Production Storage and Offloading), but we put just as much investment into the seabeds and into wells below the surface of the sea as we do into that FPSO. And we have started doing some of that fabrication here in the country,” the Exxon President noted.
Routledge said some of the works they did so far include the fabrication of the jumpers – the steel pipes that go on the seabed to connect wells to floor lines. But he pointed out that with this new facility at Vreed-en-Hoop, much more could be done in the country.
“What this project is going to do is going to be 10 times that [with] heavy load berthing points, much more capacity to do more construction and assembly work in the country that will truly be a springboard for the Yellowtail and future projects to increase local content for what we do in the oil and gas industry in the country,” he posited.
Meanwhile, one of the Directors of the local consortium, Nicholas Boyer, stated that bringing these services to the local shore would enable more job opportunities for Guyanese. In fact, he disclosed that during the construction stage, approximately 200 to 300 jobs will be created and this figure will significantly increase, several times over when the facility is operationalised.
Boyer noted that construction will commence as early as next month in order to meet the project’s completion timeline in the fourth quarter of 2023. He stated that the port facility is meant to be the kickstart of bigger developments to come in Guyana.
“What drove us through this process was a responsibility, and dare I say a privilege, that we had to do this for the country because the country needs a development that will increase local content, reduce commercial shipping costs, provide land for service companies and who need service companies, and provide land in a place that is not impacting on existing operations, neighbours – that’s why you see went through and still doing a complete Environmental and Social Impact Assessment.”
“Definitely, this is not a get-rich-quick scheme but what it does for the development of this country is incredible,” the Guyanese businessman stressed.
Moreover, Boyer further stated that the project is being financed entirely by private investors with the only support from the Government being the lease of the lands at the West Demerara foreshore, where the facility will be built.
Speaking at Friday’s signing ceremony, which was attended by representatives from the consortium as well as other stakeholders, Natural Resources Minister Vickram Bharrat lauded the group of Guyanese businessmen for initiating this project.
He urged other Guyanese to follow suit and make similar investments to further develop Guyana’s infrastructure capacity.
“The Government is willing to work with everyone who has an agenda to push development in the country. And that is what we’ve been doing. From day one, President [Dr Irfaan] Ali has been saying let us form ourselves into partnerships, into joint ventures, into consortiums because we don’t have the resources to invest; and that is what is happening here today.”
“And we need to see much more of this because there are many more opportunities… There are many more opportunities out there, there are many spin-offs that will come from this development too and besides that, there will be other developments in other [offshore oil] blocks. So, the door is not closed on any single investor or investments in Guyana,” the Natural Resources Minister posited.
Located in Region Three, the Port of Vreed-en-Hoop will occupy some 400 hectares of coastal land.
Phase One of the project will see the deepening, widening, and dredging of the access channel, as well as land reclamation. It also includes an offshore terminal, dry dock facility, and fabrication yard spanning 65 hectares. Meanwhile, Phase Two involves deepening the dredging of the access canal and expanding reclamation.
The mega-port will centralise multiple shipping and logistic services in one location.