Financial benefits of gas-to-energy project far outweighs debt servicing costs – Jagdeo highlights

People’s Progressive Party General Secretary, Dr Bharrat Jagdeo on Thursday criticised the opposition for what he described as incessant misinformation and selective concerns surrounding the transformative Gas-to-energy plant being developed in Wales, Region Three.

Despite the project promising economic benefits both individually and nationally, opposition elements have continuously ignored these and instead, shifted their focus on minor issues, changing narratives over time.

Addressing the matter on Thursday, Jagdeo outlined the evolved criticisms, emphasising the project’s feasibility through a United States Export-Import Bank (EXIM-Bank) loan, amounting to US$526 million.

This line of credit will cover about 25 per cent of the project cost, while the remaining scope of the project will be financed with the government resources.

However, despite being proven wrong on all the allegations, the opposition has now shifted focus to concerns about rising costs and loan interest rates.

“They still want to run down the project. So they shift now speaks about the rising cost of the project,” Jagdeo lamented.

In addressing these concerns, the general secretary pointed out that the 4 per cent interest rate is highly competitive, given global market conditions.

In addition, according to Dr Jagdeo, previous projections on the cost of electricity stood at 7 cents per kilowatt-hour (kWh), and updated numbers have shown that this can be decreased significantly.

ECONOMIC BENEFITS

When completed, massive economic benefits will transform the country’s savings as well as individually.

Jagdeo reiterated that the project will save 1 million barrels of oil annually, resulting in $100 million in foreign exchange savings per year.

Also, 2,600 gigawatt hours (GWh) of power will be generated annually, and at the current consumer rate of 22 cents per kilowatt hour (KHw), $500 million in revenue will be generated for the Guyana Power and Light (GPL).

With the government plans to cut electricity costs by 50 per cent, consumers will save approximately $250 million per year.

Dr Jagdeo further detailed that with cooking gas production, costs will be slashed by half and can result in additional savings of $138 million.

And according to the general secretary combined savings from electricity and LPG will amount to $388 million a year.

These savings alone, he emphasized, could repay the entire project cost within six years, while critics focus on the $55 million annual loan interest payments.

Dr Jagdeo emphasised that the project’s financial benefits far outweighs the debt servicing costs.

“How can they not see this? It’s not that they are not seeing it. They talk about everything else, how much we have to repay a loan, but they would never tell you about what will benefit the people of this country,” Dr Jagdeo underscored.

The Gas-to-energy project is Guyana’s largest single investment, with significant economic m, environmental and social benefits.

The multi million loan from US EXIM-Bank will aid the construction of a natural gas separation plant, a 300 MW combined cycle gas turbine power plant and services related to the gas supply pipeline. [DPI]