GPL to spend additional money to support US$900M gas-to-shore project - report says

GPL to spend additional money to support US$900M gas-to-shore project – report says

Jul 22, 2021 News

Kaieteur News – Much like the case of the Amaila Falls Hydro Electric Project, the publicly touted price tag had always excluded—prior to being exposed by this publication—that the Guyana Power and Light Inc. (GPL) would have had to incur its own spending, to complement the project.

An example of the onshore aspect of a natural gas pipeline.

The same obtains this time around with the much vaunted gas-to-shore energy initiative being pursued by the Guyana Government along with Stabroek Block Operator, Esso Exploration and Production Guyana Limited (EEPGL)—ExxonMobil Guyana.
This much is evident in a report commissioned by the Inter-American Development Bank, into the feasibility of the proposed project estimated at US$900M and done by K&M Advisors which in its findings had recommended that GPL construct a 69 kilo-volt (kV), “only evacuation system for initial (lower) plant output, over a single 1-927 All Aluminum Alloy Conductor (AAAC) line constructed between Good Hope and Columbia.”
This, it said, would be needed to be constructed at 115 kV insulation, clearance and strength, along with another 69 kV line constructed at 230 kV insulation, clearance and strength between the proposed gas fired plant and New Sophia.
When those line capacities are close to reaching their limit, the 230 kV evacuation system —according to the report—should be constructed to augment the 69 kV system, according to the report.
This would represent several millions more in additional costs to be added to the overall gas-to-shore initiative—information previously withheld from the project.
The Environmental Protection Agency is currently conducting scoping exercises following an application by the EEPGL for environmental authorisation to proceed with the construction of the pipeline from the Liza field.
Additionally, the Guyana Government is currently seeking private partners with which to proceed with the onshore aspects of the project through a joint initiative, technically referred to as a Public Private Partnership (PPP).
The Government says it has finalised the Wales Development Zone (WDZ) as the termination point for the pipeline from the Liza Area in the Stabroek Block, offshore Guyana and as such is seeking private investors or a consortium to be part of the project.
This is according to an Expression of Interest (EOI) advertised by the Ministry of Natural Resources, which said in the invitation that it is calling for joint participation in the proposed gas-to-shore project with the government and Esso Exploration and Production Guyana Limited (EEPGL)—ExxonMobil Guyana.
According to the advertised EOI, the government and EEPGL are looking for partners “in designing or utilising the outputs from an NGL (Natural Gas Liquids)/LPG (Liquefied Petroleum Gas) facility and related facilities.”
This includes, according to the Ministry, design, construction, and financing of a power plant fuelled by Natural gas, where the power will be delivered into the GPL’s distribution grid. This is in addition to industries that can utilise Natural gas for, “Natural gas driven developments and growth.”
According to the invitation, interested parties can bid to take part in any of the elements individually or collectively. The Ministry in its invitation noted too, that the decision on Wales was taken after extensive evaluation of multiple sites with ExxonMobil Guyana Limited/EEPGL.
The WDZ encompasses 14,000 plus acres of land of which approximately 1,300 acres will be set aside for heavy industry/gas-related investments. The project, according to stakeholders, is expected to see some 27 kilometres of pipeline being buried from the Crane, West Coast Demerara (WCD) location to Wales, in addition to some 200 plus kilometres of pipeline from the Stabroek Block where the Liza Destiny Floating Production Storage and Offloading Vessel is located.
Additionally, the project will involve the establishment of a gas-processing plant (GPP) and a Natural gas liquids facility (NGL) capable of producing at least 4,000 bbl./day, including the fractionation of liquefied petroleum gas (LPG).
The private partners will also be expected to take part in the operations of the establishment of a power plant to generate 150 MW, with an additional 150 MW as a second phase in addition to the establishment of an industrial park comprising industries that can utilise gas, steam and/or electricity.
Interested parties have been given up to August 29 to submit proposals.