GPL will still have to add generating capacity to support gas plant 14 years from now — IDB Report

Jul 23, 2021 News

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Kaieteur News – A 255 megawatt (MW) Natural gas power plant would be able to cover Guyana’s electricity demands for up to 2035 or just over a decade for another 14 years at which point in time, the Guyana Power and Light Inc. (GPL) will have to install additional generation capacity.

This is in addition to the initial expenditure of installing two high powered distribution cables ahead of any such project.

The prediction is outlined in an Inter-American Development Bank (IDB) commissioned in 2019 to look into the feasibility of a gas-to-shore energy project utilising a Natural gas, fired power plant to generate up to 255MW.

The report done by K&M Advisors had outlined in their report, that utilising the committed amounts of 50 million cubic feet of gas daily from the Liza Destiny in the Stabroek Block, the project could see a new plant being constructed initially at a capacity of 102 MW including two dual fuel engines with a total capacity of 34 MW installed prior to 2023.

According to the report, the capacity will then gradually increase to 255 MW and posits that “there is sufficient firm generation capacity till 2035 to cover the peak load.”
It was noted, that even though the firm capacity in 2035 is below the peak load plus 15 percent reserve margin by 9 MW, at 41 MW the reserve margin is still above 34 MW (two times the capacity of the largest unit) and, therefore considered to be adequate. The scenario outlined by the consultants, are predicated on the use of dual fuel Wartsila reciprocating internal combustion engines (RICE) each at 17MW generating capacity.

Importantly however, the report noted that it is likely that GPL will be required to start adding new firm capacity in 2035 to cover increasing peak loads beyond 2035. According to the consultants, the demand growth data and generation capacity additions presented in its analysis are based on the “Delayed Base Case” Scenario in the Expansion Study. The Delayed Base Case Scenario assumes that the electricity demand growth in Guyana would lag behind the expected growth in GDP resulting from the recent oil discoveries off Guyana’s coast and the associated investments.

The report said too, that generation capacity analysis is based on the data provided by GPL on the existing generators, firm, and renewable capacity additions forecasted by the Expansion Study. The additional natural gas capacity, according to K&M’s analysis, is modified based on technology options, and the maximum capacity that can be supported by the proposed 50 million cubic per day Natural gas supply scenarios, “based on heat and material balance calculations.”
The additional generation capacity to be installed would represent additional spending by the utility company in order to support the success of the gas-to-energy initiative.

This publication yesterday, reported that 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 GPL would have had to incur its own spending to complement the project.
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.
In a report, it was found that it was recommended that GPL would have to 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 (EPA) 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.
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.”
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 US$900M 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.

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