Guyana Government still to decide location for gas to power plant

David Patterson

Government already knows that more than 200 people will gain employment as a result of the gas to power project. It knows that electricity will be reduced to US 10 cents per megawatt/hour and that the project will see a 200 mv plant. What the government still does not know is where the plant will be located. A final decision is still to be made.

This decision is one that is currently stalling the completion of a feasibility study that ExxonMobil is conducting to determine the economic viability of the gas to power project which has been dubbed a temporary fix for Guyana’s electricity woes.

The development of this project is under the Minister of Public Infrastructure, David Patterson.

The Production Sharing Agreement that exists between Guyana and ExxonMobil gives the company the right to re-inject associated gas into the oil producing wells. It also provides for alternative arrangements like the gas to power project. But, such, according to the contract, is predicated on a feasibility study that must be done by ExxonMobil.

A few weeks ago, when he held his first press conference thus far, Head of the Department of Energy, Dr. Mark Bynoe, said, “A gas to power feasibility analysis is being conducted.”

Charles Ramson

Attorney at Law, Charles Ramson, told this newspaper that he has been reliably informed that ExxonMobil “has already done all it could, that the company has done its part. But the feasibility study is stalled because the government cannot provide the needed facts.”

[ Editor’s Note: Ramson, who severed as a People’s Progressive Party/Civic (PPP/C) Member of Parliament, is now vying for leadership in the PPP/C, against the wishes of former President Bharat Jagdeo. He is well trained in the oil and gas industry and comments on it regularly. ]

He said that ExxonMobil and Government already know that the project is viable in that the needed electricity can be generated. However, Ramson said that the very important economic analysis that forms part of the feasibility study, is still to be completed.”

The lawyer, who also has a master’s degree in Oil and Gas Management, explained that in order for ExxonMobil to determine the economic feasibility of the project, there are several decisions that the government will have to make upon demand of the company.

“When the company is armed with these decisions, only then will it be able to complete its assessment. For instance, you cannot expect ExxonMobil to be able to pronounce on whether the project is economically feasible if it does not even know where the plant would be located.
“That is a decision that the government has to make and cannot make on to this date. How are we to be considered a serious country if simple things like these cannot be given priority?”

Ramson noted that, so far, only associated gas has been discovered in Guyana. He recalled ExxonMobil’s Country Manager, Rod Henson, saying that ExxonMobil still thinks it best that Guyana re-injects its natural gas. Henson said that that is a more economical route to take. However, he also said that ExxonMobil is considering Guyana’s special circumstance and the need to reduce the cost of electricity.

These comments were made during a parliamentary meeting of the Committee of Natural Resources.
Ramson said, “Considering all that Henson has said, we need to decide soon whether we want to go down the road of gas to power. But the main thing is that we need to decide.”

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