Opposition demands release of Consultant’s report on arbitration

Apr 19, 2024 ExxonMobil, News, Oil & Gas

Opposition Spokesman on Oil and Gas, Elson Low

Gas-to-Energy project…

Kaieteur News – The recent explanation, provided by Vice President Bharrat Jagdeo on the arbitration filed by the Gas-to-Energy Contractors, has sparked further concerns regarding the chaotic project which can best be resolved through the release of all documents, including the report from the Indian Consultant.

This is according to the Opposition spokesperson on Oil and Gas, Elson Low. The Economist made these remarks during the Leader of the Opposition’s weekly press conference on Thursday. “Vice President Jagdeo, in attempting to extinguish the quickly gathering storm over the Gas-to-Energy project, led the nation on a rollercoaster of half-truths and blame dodging,” Low said. Given the vital nature of the project, however, Low argued that Guyanese deserve “the whole truth” from the leader and for the People’s Progressive Party (PPP) to take responsibility for the “chaotic project”. The GTE project’s three main components are the pipeline being built by ExxonMobil and the Natural Gas Liquids (NGL) facility and power plant being pursued by the Government of Guyana (GoG). These aspects of the venture are pegged at US$1B and US$759M respectively.

A number of attempts by the Opposition for all agreements relative to the project to be made public have been unsuccessful to date, but with construction delays now expected to push back the completion of the project to 2025, the Opposition believes the best way for the nation to be informed is through the release of all documents. Jagdeo revealed last week, following a report from Reuters, that the two contractors CH4 and Lindsayca that were awarded the US$759M in December 2022, have filed for a dispute resolution over a disagreement with the government on the delayed project.

He said while the government has accepted a three-month delay as a result of Exxon being unable to complete the site preparation, the contractors have disagreed, stating that they will require more time to complete the gas plants. According to Jagdeo, “That is where we are arguing the three months delay on the project came. They want a longer period because the liquidating damages for not completing the project on time for the contractor, if they don’t complete the project on time, it’s over US$11M per month they have to pay in liquidating damages for delay on the project so they are arguing they need more time beyond the three months. We are saying three months is adequate.”

For his part, Low believes the explanations have only sparked further questions. According to him, “There appear to be significant issues with the soil at the Wales site. Since Jagdeo claims the government did “a feasibility study” which considered site soil (he mentioned marshy land at Palmyra), we challenge him to release that study.”

The Opposition spokesman said Guyanese are concerned that the VP has once again neglected to assess the key elements associated with the major national project, which if delayed will allow the nation to face an electricity crisis 2025 and beyond.

To this end, Low called for the government to release the report by Engineers India Limited (EIL), the firm hired by government to oversee the project. The company had reportedly reviewed the claim by CH4- Linsayca and rejected it in its entirety, according to Jagdeo.

Be that as it may, Low said, “The public needs to know what exactly has been presented so that there is clarity as to the current state of the project and the risks that may come from arbitration, but also from any dispute about the design and site of the project.”

He continued, “Jagdeo, in blaming Exxon and GYSBI, is trying to absolve the government from any responsibility, when it is ultimately the government that is responsible for ensuring each leg of this project is completed on time and in good order.” To this end, the Opposition made it clear that the Vice President must not be allowed to dodge these critical questions since a delayed project could not only escalate the cost of the venture but result in “unforeseen consequences.” Furthermore, “As natural gas can be explosive, the people of Guyana must demand reassurances on the engineering and operational safeguards to be put in place to prevent any disaster. Such a project must not be cloaked in secrecy and uncertainty,” Low reasoned.

arbitration, GTE, low, Release, Report

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