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‘You cannot spend taxpayers’ dollars on major projects without a feasibility study’ – AFC Leader Hughes
AFC Leader, Nigel Hughes
Kaieteur News – In strong criticism of the government’s initiation of major projects funded by taxpayers’ dollars, especially those financed by oil proceeds, Alliance for Change (AFC) leader Nigel Hughes has stressed the crucial importance of conducting feasibility studies before undertaking such ventures.
At his first press conference since assuming leadership of the party, Hughes condemned the Government of Guyana’s decision to pursue major projects without adequate feasibility assessments.
Responding to a question about the Government embarking on a second major gas project while the US$2 Billion Gas-to-Energy (GTE) project is still to commence, Hughes articulated his concerns, stating, “In this country we have to legislate because we don’t seem to follow international norms. There is no major project that this country should undertake without a feasibility study. It is absolutely irresponsible and reckless and therefore, first project second project or any project, you cannot come to the people of Guyana, spend their money without a feasibility project. We will not have a repeat of that fiasco that is the skeleton factory.”
To that end, Hughes reiterated the AFC’s opposition to using the Natural Resource Fund (NRF) proceeds for projects lacking feasibility studies, citing it as reckless. “We will oppose that locally and we will take it internationally because it is a reckless use,” he said.
The Government’s current flagship project, GTE initiative, is poised to become Guyana’s first natural gas venture. Set to be located in Wales, West Bank Demerara, the project aims to generate 300 megawatts of power and produce 3,400 barrels of by-products daily, including cooking gas and fuel derivatives.
At one of his recent press conferences, Vice President Bharrat Jagdeo, clarified that despite the government vigorously pursuing the monetization of the country’s untapped gas resources through a second major gas project, they currently have no plan to provide financial backing for the initiative.
A U.S.-based firm, Fulcrum LNG proposal which includes partnerships with leading companies like McDermott and Baker Hughes, emerged as the preferred choice after a rigorous evaluation process. President Irfaan Ali had disclosed that Fulcrum LNG was selected to collaborate with ExxonMobil Guyana Limited (EMGL) and the government in a tripartite agreement to monetize the gas resources.
“This is a risky project because it’s a multi-billion-dollar project,” Jagdeo said.
Vice President Jagdeo underscored global market uncertainties and potential shifts in U.S. energy policies as other reasons for the cautious approach.
He said, “We are not sure about future demand for gas although many people believe that it will be replaced, it will still be needed long into the future since it will be a transitional fuel, and therefore the demand will still be high.”
Notwithstanding the uncertainty Jagdeo said, “We want to monetize this, so that we [can] add to the revenue stream that comes from the production of oil, another stream of revenue that comes from the utilization of our gas reserves.”
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