Govt. to move ahead with second gas project despite not finalising monetization strategy – VP Jagdeo 

Jul 16, 2024 News

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Kaieteur News – Vice President (VP) Bharrat Jagdeo has stated that despite not finalising the National Gas Monetization Strategy, the Government of Guyana (GoG) has embarked on a second gas project to check for viability.

“We are still working on it,” Jagdeo said at his last press conference after he was asked if the government has abandoned the heavily criticised gas strategy, in which US$20,000 was paid to former Trinidad & Tobago Energy Minister, Kevin Ramnarine to prepare. “But as you have seen, we have moved forward in the project that we wanted to check the viability for. We have moved forward on that, but the gas strategy is a clear one,” Jagdeo added.

Back in January, the Government issued Request for Proposals (RFP) seeking private sector pitches for the design, financing, construction, and operation of gas processing infrastructure. In June, President Irfaan Ali disclosed that United States-based firm Fulcrum LNG proposal was selected.

Jagdeo explained that the key element of the gas strategy is to figure how to monetise the associated gas outside of the current gas project.  “We have moved forward on that element,” Jagdeo stated. Presently, the GoG is pursuing a US$2 billion Gas-to-Energy (GTE) project that will be located at Wales, West Bank Demerara. This is the country’s first natural gas project. It entails bringing the gas onshore from the Stabroek Block to feed a liquefied natural gas (LNG) facility and generate 300 megawatts from a power plant. ExxonMobil Guyana Limited (EMGL) is responsible for building a 12-inch pipeline that will transport 50 million cubic of gas per day to the Wales location from offshore.

Outside of that, the Vice President said, “…We may have another 70 – 80 million cubic or so to come in on that pipeline we have to now make a determination how we would utilise that. It could be for generating additional power, fertilizer, different things.”

Jagdeo underscored that normally a gas strategy is about determining not just how to monetise the gas but how to use it for national development. He continued, “But we are working on it, it’s not an abandoned project.”  Moreover, Jagdeo also responded to comments made by leader of the Alliance For Change (AFC) Nigel Hughes, who stated that using taxpayers’ dollars, especially those financed by oil proceeds, without conducting feasibility studies is “reckless”.

Responding to a question about the Government embarking on a second major gas project while the US$2 billion GTE project is still to commence and facing setbacks, 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.”

Hughes reiterated the AFC’s opposition stating that the party will oppose any project without a feasibility study locally and internationally because it is a reckless use of taxpayers’ dollars. Notably, the agreements for the first project are yet to be laid in the National Assembly despite repeated commitments by government. For his part, Jagdeo said, “So we don’t know whether we have a project as yet.”  The Vice President reminded of his previous statement when he clarified that despite the government vigorously pursuing the monetisation 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.

“The Government of Guyana has made it clear that we are not putting any money into this project but we have to explore whether we can develop a viable project now, so that means a feasibility studies everything else to see if we can monetise the gas that we have, the associated gas outside of the gas that is coming to the power plant,” Jagdeo said. He said Fulcrum LNG was hired to look at all streams of benefits from possibly LNG exports or for industrial development. “All of that will have to be explored before you move to say we have a project, it’s viable before you move to get it financed but it’s not financed from the Government of Guyana…” he added.

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• Bharrat Jagdeo, gas, GTE, monetisation, Nigel Hughes

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