VP Jagdeo says PPP boys will not cash-in from Gas-to-Energy project, but still hiding agreements

Mar 19, 2024 ExxonMobil, News, Oil & Gas

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Kaieteur News – Although Guyana as an implementing member state of the Extractive Industries and Transparency Initiative (EITI) is required to ensure public accessibility to all licences and contracts underpinning the extractive industry, the Government of Guyana (GoG) is yet to disclose any of the deals related to the controversial Gas-to-Energy (GTE) project.

The administration was called out for the lack of transparency in the development of the massive US$2B project by former Minister of Public Infrastructure, David Patterson who even intimated his concern that operation and maintenance contracts may be to the benefit of PPP cronies. Vice President Bharrat Jagdeo during his Thursday press briefing responded to two articles published by Kaieteur News on March 12, 2024 and March 13, 2024 in that regard.

In the first article, Patterson was quoted as saying the government has not released any of the agreements relative to the project as they reveal the true beneficiaries, see link below:

https://www.kaieteurnewsonline.com/2024/03/12/govt-hiding-wales-gas-plant-agreements-from-public/

Meanwhile, in the second article, the former Minister explained that the Operation and Maintenance contract for the project can provide “generational funding” for PPP cronies. https://www.kaieteurnewsonline.com/2024/03/13/20-year-maintenance-contract-for-gas-to-energy-project-will-benefit-ppp-boys-patterson/

He explained that, “if it’s one of the PPP cronies and you get US1 cent per megawatt for 300MW for 365 days for 20 years. If you do the maths, you can see that that’s generational funding…that is why they do these things so opaque and they’ll say oh it’s some company and of course the beneficial owners will not be known until the government is changed and we unravel it.”

Jagdeo told reporters that Patterson’s contentions were purely “fictitious” and that the government will require international expertise to manage and maintain the project.

“The fact of the matter is there is no such company, nor agreement. We have not decided which company (as yet), we are (currently) building the plant, we still have to go out to tender for a company to manage the plant and it will be an international company because this technology there, using gas, we don’t have that capability in GPL at this stage to manage a new plant of this nature,” the VP explained.

He stressed, “The facts are that we have not, there is no such contract, there is no such company. He has already concluded this will benefit PPP boys and he calculated how much money too and it’s all fictitious but he gets two headlines in the Kaieteur News for this fiction.”

Notably, although the Vice President dispelled Patterson’s concerns over the PPP benefitting from the contracts, he did not address the release of the agreements for the Gas-to-Energy project.

Since 2022, the government signed a Heads of Agreement (HOA) with the Stabroek Co-ventures that outlines the principles and conditions for the commercial and technical arrangements of the deal. Several other agreements and contracts for the project have also been signed but remain hidden.

Patterson had requested a copy of the HOA agreement in Parliament back in December 2022, but the Minister of Natural Resources, Vickram Bharrat said it could not be made available yet.

Patterson in his request for the information, submitted to Parliament on October 18, 2022, had asked whether any agreements were signed with ExxonMobil Guyana Limited (EMGL)- formerly Esso Exploration and Production Guyana Limited (EEPGL)- in connection with the Wales project and if yes, for the Minister to supply the House with a copy of the said agreement.

Bharrat in his response to Patterson said, “There are other agreements on supply, buyer’s agreement, field development, licensing conditions, onshore works, and land matters that are currently being drafted. The respective agreements and policy documents will be presented to this Honourable House when they have been agreed upon and executed. All agreements are being done in a timely manner to meet the Final Investment Decision which will allow for the project to be completed by our committed deadline of December 2024.”

Notably, the timeline for the delivery of the GTE project has now been shifted to 2025, and Exxon is yet to make a Final Investment Decision for the initiative.

Exxon is constructing the pipeline component of the project that will be used to transport natural gas from the Liza fields in the Stabroek Block to the Wales Development Site.

Meanwhile, the government is constructing a Natural Gas Liquids (NGL) facility and a 300-megawatt power plant, aimed at reducing electricity charges by 50%.

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• agreements, cash in, gas, gas-to-energy, Jagdeo, Patterson

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