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Guyana must decide if it wants to become another Trinidad and Tobago – Int’l Expert
US$900M Gas-to-Energy Project…
By Kiana Wilburg
Kaieteur News – ExxonMobil and its partners, Hess Corporation and CNOOC Petroleum Guyana are determined to quickly develop and monetise the oil and gas resources in the Stabroek Block. Its interests in this regard are aligned with the PPP/C Government, which believes the pursuit of fossil fuel will fast track the nation’s economic growth and development.
Chatham House Fellow, Dr. Valerie Marcel.
However, there are risks that lie in the pathway of both sides realising their shared interests. According to Chatham House Fellow, Dr. Valerie Marcel, Guyana could find itself facing the risks of oil dependence if it goes further into the abyss of fossil fuel development. These risks include corruption and fluctuating growth.
During a recent appearance on Kaieteur Radio’s Programme, Guyana’s Oil and You, the International Petroleum Expert alluded that one only ought to examine the worrying state of affairs in Trinidad and Tobago to understand the risks in question. Her comment in this regard was in response to a query on whether Guyana is heading in the right direction by bringing gas-to-shore via a US$900M project, especially at a time when the rest of the world has begun a slow but steady march towards decarbonisation.
“I think it is a critical question, and that is how much does Guyana as a new producer want to follow the path of countries like Trinidad and Tobago that have used as much of their oil and gas as possible to create petroleum value, which now amounts to a chain of dependence on the oil and gas because industries are using it as feedstock, cars are being driven with cheaper petrol and they are into refining so they have created a whole industry and economy around it,” expressed the Chatham House Fellow.
She added, “Guyana, starting today, (must say) does it go down that route or does it pull toward a different identity and development path?”
Given Guyana’s vast forest cover and the fact that it is known as a carbon sink, Dr. Marcel asserted that the country enjoys an identity of being a green State. Confronted by the interests of oil companies and that its own, Dr. Marcel contended, that Guyana has witnessed the birth of two pathways or visions for its future. One road is paved with oil and gas and the other beckons the climate friendly benefits of projects that utilise sun, wind, and water. Dr. Marcel said she does not believe Guyana would want to choose the former, which Trinidad and Tobago did. She noted nonetheless, that one would want to ascertain if Guyana wants to keep the pure focus on being a carbon sink and maintain the pristine forests thereby, sacrificing potential industrial developments and having gas as a cheap feedstock for some industries. “It is once you get into the details that you realise that ‘oh well I am willing to sacrifice a little bit of that green model to get some of the Trinidad economic prosperity,” expressed the international expert.
She noted at this point, that this is where the question of Guyana’s move to utilise its gas resources for cheaper electricity purposes comes in.
On this front, the Chatham House Fellow said, “Gas I have to say is the most complex areas for countries that are part of the New Producers Group have to tackle, because it can be perceived as a transition fuel, though that concept itself has become really like a hot button issue in the world of climate change.”
She added, “If you think of it as transition fuel that helps you reduce your use of heavy fuel oil consumption, and reduce emissions so that later you transition towards a fuller green energy mix, the reality is that, it locks you into a carbon intensive energy use.”
Dr. Marcel emphasised that one does not put in place, expensive gas infrastructure only for it to last a maximum of 10 years. She said it has to be for about 20 to 30 years. “This is expensive infrastructure so once it is in place, you have to make it worth it, hence, it does not have that full energy transition potential,” expressed Dr. Marcel.
Taking the foregoing into consideration, the oil expert said it is crucial that Guyana thinks of the long-term benefits and risks to pursuing for example, a US$900M gas-to-energy project. She alluded that while it may seem in the short term, an effective fix to the country’s energy woes and addressing carbon intensity rates, the long-term implications can be way more troubling.
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