Gas-to-Energy project fully transparent; U.S. company secured through open tender

In a major step toward energy diversification, the Government of Guyana has confirmed that its highly anticipated Gas-to-Energy project is proceeding with complete transparency. The government has followed a rigorous open tendering process, ensuring fairness and accountability in every phase of the project.

Vice President Dr. Bharrat Jagdeo emphasized the commitment to transparency during a press conference on Thursday, explaining that the government’s approach to the project has been entirely public.

“There is full transparency surrounding the Gas-to-Energy project. We went through open tenders for each stage,” he said.

The project involves multiple stages, including the construction of a power plant, a pipeline system, an NGL facility, and related infrastructure.

Dr. Jagdeo pointed out that every aspect of the project was made subject to public tender, ensuring that the selection of contractors was open and competitive.

• For the pipeline construction, the government worked with prequalified companies, all of which were publicly known prior to the tendering process.
• The power plant and NGL facility were awarded through an open public tender to CH4-Lindsayca, a U.S.-based company, with a contract value of US$759 million.
• In another significant development, Kalpataru Projects International Limited, an Indian company, won the contract for transmission lines and substations, valued at US$159 million.
• The control center has elements contracted to both American and Chinese companies, demonstrating a global collaboration.

The estimated total cost of the Gas-to-Energy project is around US$2 billion.

The government has made it clear that the financial structure of the project is fully known and publicly disclosed. Dr. Jagdeo underscored that there is no need for speculation regarding the costs, as the contract prices are finalized, and the total expenditure is known.

“You know the total price if you add the contract prices, and we are transparent about the total spending,” he explained.

The project is expected to have a transformative impact on Guyana’s energy sector, providing cleaner, more affordable energy while creating new revenue streams.

The government has secured a US$526 million loan from the United States Export-Import Bank to cover the cost of materials supplied by CH4-Lindsayca, further solidifying the project’s financial backing.

A critical question surrounding the project has been whether it would lead to increased national debt.

Dr. Jagdeo assured the public that Guyana will not be indebted to ExxonMobil.

Rather, Exxon and its partners will recover their investment through a gas sales agreement.

According to Winston Brassington, Head of the Gas-to-Energy Task Force, Guyana will pay Exxon and its co-venturers US$55 million annually for the next 20 years. However, Brassington also highlighted that the commercialization of excess Natural Gas Liquids (NGLs) will generate significant revenue for the country.

Dr. Jagdeo reiterated the government’s dedication to full transparency throughout the Gas-to-Energy project.

“We’ve been very transparent about all aspects of the project, and we have shared the exact numbers with the public. There is no need to speculate,” he said.

He reminded that each week, via his press conferences, the government provides updates on the progress of the project, keeping the public informed about the latest developments and contract details.