CGX extends deadline for Berbice deepwater port facility for third time; now scheduled for 2024

Aug 17, 2023 ExxonMobil, News, Oil & Gas

Kaieteur News – The Berbice deep-water port facility being undertaken by Canadian oil explorer, CGX Energy Inc. through its subsidiary, Grand Canal Industrial Estates Inc. (GCIE) would not be ready for use until next year. This is according to the latest financial statements for CGX dated August 10, 2023.

The financial documents note that the port, located adjacent to Crab Island on the Eastern Bank of the Berbice River, is being designed to service the oil and gas industry as well as general cargo and the agricultural industries in Guyana. Notably, the port is expected to benefit from its proximity to the oil and gas industry in Suriname.

CGX said the project now targets operation of the cargo terminal aspects during first quarter of 2024 while the operation of oil and gas support base is slated for operation in mid-2024, subject to construction schedules, financing, and supply chains. It should be noted that this is not the first time the project has faced setbacks in its timeline. It was initially scheduled to be completed since the fourth quarter of 2022 (See link for further details: https://www.kaieteurnewsonline.com/2022/08/11/berbice-deepwater-port-will-not-meet-2022-deadline-cgx/#:~:text=Kaieteur%20News%20%E2%80%93%20CGX%20Energy%20Inc,bank%20of%20the%20Berbice%20River.).

That timeline was then pushed back to late 2023 which this newspaper reported on. (See link : https://www.kaieteurnewsonline.com/2022/11/30/berbice-to-get-oil-and-gas-support-base-in-late-2023/)

A section of the port facility being done by CGX

Even before the close of the year, the company has already put its shareholders on notice that critical aspects would not be ready until 2024 but even that is hinged on certain conditions as outlined earlier.

In its financial statements, CGX said significant infrastructure projects in Region Six which have been announced by the Government of Guyana are what motivate the completion of the cargo aspects of the port, especially with respect to the handling of aggregates and other construction materials which must be imported into the region from elsewhere in the country and offshore. Some of these projects include the construction of the Guyana Technical Training College which will place special emphasis on skill sets for the oil sector. That project is set to be located in Port Mourant. It is a collaborative effort between the Guyana Government and an ExxonMobil-led consortium which operates the oil-rich Stabroek Block.

During the six-month period which ended on June 30, 2023, GCIE said it incurred additional costs totalling US$551,549 for the port. For the year ended December 31, 2022 this total was US$3,245,855. It therefore means that approximately US$3.8M was already expended on that aspect of the facility for that period, adding to the over US$20M already spent since the project got started. The total cost for the facility is pegged at US$80M.

GCIE said it expects that the port will significantly boost local content engagement in the oil and gas sector and add enhanced logistics capacity for import and export, including expandable capacity to accommodate the possibility of increased product flow to and from the northern states of Brazil. Due to its location close to Suriname, the port’s oil and gas support functions will also help to serve the rapidly growing offshore exploration and development activities in that country’s oil and gas sector.

Furthermore, GCIE said the port is expected to add significant capacity to the agricultural sector, supporting rice, sugar, agro-processing and agricultural materials. GCIE said too that it has performed various developmental works on the site, including the installation of vertical drains and geotechnical treatment of the quayside land.

The subsidiary noted that riverside construction is completed on approximately 500m of rip rap flood protection, a 10 acre quayside laydown yard built to a five tons per square metre load bearing capacity, an access bridge to the main Corentyne highway and 2.6 km access road, both built to American Association of State Highway and Transportation Officials (ASSHTO) standards, concrete drains and driveways for residents along the roadway and extension of municipal water and power to the port site.

It said requests for proposals were advertised for the wharf platform and access trestle, capital dredging programme, design and construction of all gates, buildings, firefighting and first aid structures and covered storage areas. Kaieteur News understands that evaluations of submitted proposals for the capital dredging and construction of the wharf platform and access trestle were completed and a local contractor, Gaico Construction and General Services, awarded. The successful bid incorporates an update to the design of the wharf and trestle to realize cost efficiencies.

GCIE said work on in-river construction of the 50 x 12 m access trestle being built from the quayside yard westward into the Berbice River is progressing on budget and no health and safety related incidents, with completion of the trestle expected in August 2023.