High interest as Amaila hydro project back on table – Harmon

May 22, 2018 News

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Government has reiterated assurances that it is still open for a hydro electric dam to be built at the Amaila Falls in Region Eight.
The project was never off the table, but rather, there were deep misgivings over designs and the high costs of the project, Minister of State, Joseph Harmon has said.
The project was being developed by US-owned Sithe Global with a Chinese contractor hired, for over US$500M. However, it fell through in 2013, when the Coalition, which was in Opposition, voted down key legislation, halting the project.
The road project cost was said to be upwards of US$35M.
The previous government of the People’s Progressive Party/Civic has been pushing for the hydro project.
On Thursday, Minister of State Joseph Harmon made it clear that it has always been a decision of the Coalition Government to not spend anymore or go ahead with it as it was configured.
Since entering office in 2015, the administration has been approached by other parties with the necessary information shared.
Recently, Minister of Natural Resources Raphael Trotman told a parliamentary committee that the project is not dead.
According to Harmon, the issue of the project was even mentioned in the budget speech of Finance Minister Winston Jordan, who left the door open for the project, but said it is not a priority.
Projects like Amaila and any sustainable energy project will be given the blessings of this administration, he assured.
It will be recalled that the Norwegian Agency for Development Cooperation (NORAD), in support of the Norway’s Ministry of Climate and Environment’s International Climate and Forest Initiative (NICFI), had signed an agreement with Norconsult AS of Norway, on June 20th, 2016 to carry out an initial analysis.
In August 2013, the preparations for implementation of Amaila Falls Hydropower Project came to a standstill, as the Parliament of Guyana did not vote unanimously in favour of certain features of the project presented by its main sponsor, Sithe Global, a US-based investor in the international energy market.
Sithe Global withdrew from its position as main sponsor, throwing the project’s future into jeopardy.
The Government of Guyana – represented by the Minister of Finance and the Minister of Natural Resources – and the Government of Norway, represented by the Minister of Climate and Environment, decided at a meeting in Paris in December 2015 to perform “an objective and facts-based” assessment of the Amaila Falls Hydropower Project.
The project was heavily pushed by the last two administrations of the People’s Progressive Party/Civic (PPP/C) but ran into trouble early, specifically problems with the access roads to the Amaila Falls dam site in Region Eight. The roads collapsed in many parts and the contractor was fired.
The US$900M-plus tagged for the 165 megawatts project was seen as too costly, with criticisms over the technical readiness of the Guyana Power and Light Inc. to take the power. There were also questions over whether the dam would actually be able to sustain the promised power, with one photo even showing the waterways dry.
The administration had said that it was considering several waterfalls across Guyana to develop.
Norconsult had acknowledged in its report that the Amaila Falls project would not be enough and that as the power demand is growing, and for reaching the goal of 100% emission-free generation by 2025, a second hydro-power plant of capacity comparable with AFHP would have to be commissioned by then.
The report tagged Amaila as the best hydro option, as there are immediate current reports relating the environmental and social impacts.
To get on with project or similar ones, the consultant said the Government of Guyana (GOG) will need continued support by the Inter-American Development Bank (IDB), or a similar institution, and Guyana Power and Light will need technical and management support by a highly qualified engineering company with extensive experience from the international hydropower industry.
The report suggested that the cost for buying out Sithe Global from the project company and expenses for services by an engineering company engaged for support until a new main sponsor is established, are covered from a portion of the US$80 million deposit in IDB, for later being turned into equity contribution from GOG to the project company.
Norway since 2009 had supported the project, depositing US$80M in IDB earmarked for Guyana’s equity share in AFHI, a Special Purpose Company for realising the project.
Guyana would have borrowed the rest from Sithe Global and the Chinese, among others.

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