Vice President Dr Bharrat Jagdeo has said that international lawyer, Melinda Janki, is “hopelessly misguided” in her efforts to block funding from the United States Export-Import (US EXIM) Bank for Government’s model Gas-to-Energy (GtE) project.
Back in April last year, it was announced that Guyana had applied for a US$646 million loan from the US Exim Bank to finance the Gas-to-Energy project, which includes the construction of an Integrated Natural Gas Liquid (NGL) plant and a 300-megawatt (MW) combined cycle power plant at Wales, West Bank Demerara (WBD), utilising natural gas from the country’s offshore operations.
That loan is still being processed by the bank and Janki, on behalf of Elizabeth Deane-Hughes and Vanda Radzik, wrote the Bank on January 12, 2024, urging that financial institution withhold funding for the project. In the letter, the lawyer informed President and Chair of the US EXIM Bank Board of Directors, Reta Jo Lewis, of a ruling by the Guyana High Court that the Environmental Protection Agency’s decision to grant the permit to Esso Exploration & Production Guyana Limited (EEPGL) – ExxonMobil’s local affiliate – for the project was “contrary to law and was improper.”
As such, the lawyer asked the EXIM Bank to “respect the rule of law in Guyana” and “not provide funding for any project which is based on a decision that is ‘contrary to law’.”
On Thursday, Jagdeo was asked whether government is concerned that this move will delay the processing of the loan.
However, he said “they’re hopelessly misguided” in their efforts to attempt to block the funding.
“They don’t care that this project will deliver cheaper electricity to our business community and to all of our citizens, that they’d have to pay half of what they’re paying now which could start as early as next year,” the Vice President posited.
While the US EXIM Bank is yet to approve the loan, Jagdeo is confident that this action not impact Guyana getting the funding.
“The EXIM Bank is very much aware of what is going on here in Guyana. They have technical people who follow every single thing what’s going on. They can discern serious interests and serious concerns from a propagandistic nature or a doctrinaire nature, and in this case, that’s what is happening… So, I doubt it’s going to have any impact on EXIM Bank and the provision of the loan.”
“Now, the Bank needs to satisfy itself, which it is doing through its own due diligence process, that the project is feasible because they’re financing it and that it’s environmentally sound, and they’re doing that on their own. I believe that at the end of that exercise before they go to the board, that they would find it positive on both counts – independent of what the loonies say,” the VP stated.
Previously, Jagdeo had disclosed that government can use bridge financing to get the Gas-to-Energy project underway until that EXIM Bank loan comes onstream.
“From what I gather, the loan can fund retroactive expenditure. So, if you have bridge financing then you can go back and clear it easily once the loan comes on stream,” the VP had noted in October 2023.
Earlier this week, it was announced that Government has set aside a whopping $80 billion to advance the Gas-to-Energy project this year and its associated infrastructure, including transmission and distribution upgrades to offtake the power.
Thus far, the marine offloading facility was completed, and 26 kilometres (km) of onshore pipelines have been installed. Once completed, the project will allow Guyanese to benefit from 50 per cent reduced electricity costs.
The scope of Guyana’s gas-to-energy project consists of the construction of 225 kilometres of pipeline from the Liza field in the Stabroek Block offshore Guyana, where Exxon and its partners are currently producing oil.
It features approximately 200 kilometres of a subsea pipeline offshore that will run from Liza Destiny and Liza Unity floating production, storage and offloading (FPSO) vessels in the Stabroek Block to the shore. Upon landing on the West Coast Demerara shore, the pipeline would continue for approximately 25 kilometres to the NGL plant at Wales, West Bank Demerara.
In last year’s national budget, the project received a $43.3 billion allocation, in addition to the $24.6 billion injected into the start-up of the transformational project.
