GUYANA: Natural Gas from Exxon barely enough for new power plant — Brassington

Feb 22, 2022 Kaieteur News — By Gary Eleazar

Winston Brassington

…  fertilizer, ammonia, other value added gas products now unlikely

Government last year, as part of plans to generate electricity in Guyana, using natural gas coming from the Stabroek Block invited Request for Proposals inviting joint participation in a Public Private Partnership arrangement for the construction of a new 300 megawatt power plant along with other factories, aimed at fully utilising the resource to be had through the development of fertilisers and other hydrocarbon byproducts.

The gas to be had from the Stabroek Block however, is barely enough to be used at the gas fired power plant with the remainder being able to go towards the production of about 3,700 barrels of Liquefied Natural Gas (LNG) used for cooking.

Stark revelation at Energy Conference and Expo               

The stark revelation was had during the recent inaugural Energy Conference and Expo venued at the Marriott Hotel, where project head, Winston Brassington provided potential investors and interested stakeholders with an update on Guyana’s Gas to Energy initiative.

Recognising that “this is a much bigger project than we envisaged in 2020,” Brassington told those in attendance that the original size of the project had targeted suing only 30 million cubic feet of gas per day.
This, he said was revised upwards to 50 million cubic feet per day but even this is barely enough to meet the power generation requirements.

Addressing the Energy Conference, Brassington noted that when government first invited Expressions of Interest (EOI), with companies in some cases expressing an interest in each of the areas advertised, namely the power plant, an NGL facility and value added.

“In all, I think from the 30 companies we have over 50, plus different areas (value added) that they were interested in,” he said.
Having decided on a ‘combined cycle’ technology for the power plant, Brassington noted that the project was also sized higher than initially thought, this time around building out the project in one phase—a 300MW plant with a net delivery of 250MW.

He said however, that in order to meet this requirement for the gas to be able to power that size of a power plant, it would require some 42 million cubic feet of gas per day.

With this in mind, he reminded that in view of the fact that only 50 million cubic feet of gas would be had per day, it would mean “the rich gas when we separate the liquids we would probably have just about 44/45 million cubic feet left, “which is barely enough to power a 300MW power plant.”
He did note that the project also include the NGL plant “and we are looking at an initial train 60 million cubic feet capacity and that would give us about 3,700 barrels per day.”

According to Brassington, this would be some five times the demand in Guyana at present. The Ministry of Natural Resources in inviting the EOIs had said it is calling for joint participation in the proposed gas-to-shore project with the government and Esso Exploration and Production Guyana Limited (EEPGL)—ExxonMobil Guyana.

According to the advertised EOI, the government and EEPGL are looking for partners “in designing or utilising the outputs from an NGL (Natural Gas Liquids)/LPG (Liquified Petroleum Gas) facility and related facilities.”

This includes, according to the Ministry, design, construction, and financing of a power plant fuelled by natural gas, where the power will be delivered into the Guyana Power and Light (GPL’)s distribution grid.

This is in addition to industries that can utilise natural gas for, “natural gas driven developments and growth.”

According to the invitation, interested parties can bid to take part in any of the elements individually or collectively. It was noted however, any submission for the first and third aspects of the project, namely design and utilisation of gas or the industrial park, “must demonstrate the nexus between the projects as detailed.”

With Brassington’s recent pronouncement that the gas to be had would barely be sufficient to meet the power demands of the proposed plant with limited LNG, it would mean that all of the other ventures adumbrated are now unlikely to become a reality.

Brassington in his presentation to the Energy Conference told those in attendance that the Wales West Bank Demerara location where the pipeline from the Liza Field bringing the gas onshore would be terminated was selected, “because of economics, partly because of the opportunity for large scale industrial development over time and we also wanted to be away from the population centre.”

This, he said, paved the way for the other studies to be had, such as the Environmental Social Impact Assessment and geotechnical and geophysical studies.
With the Terms Of Reference for the ESIA already completed, work has set about completing the necessary study.

Speaking to the importance of the studies to be had, Brassington sought to impress that “this is quite a complex engineering project and we were talking about coming from a mile deep in the ocean below Liza I and Liza II, coming 200km offshore and then onshore and, these projects based on historical precedence, generally take many years but we were able to agree with ExxonMobil an aggressive timeframe of end of 2024 to get this completed, with the first 18 months starting at the end of 2020 being used for all of the technical studies.”

According to Brassington, the completed draft ESIA is expected to be completed and submitted to the EPA by April.

Brassington in his update noted too that 21 of the 30 interested parties that had submitted EOIs have since provided prequalification applications which are currently being reviewed by the administration.

He said, once prequalified partners have been identified, the next step would be to have those prequalified submit proposals with the priority aspect of the project being the construction of the 300MW power plant.

The working timetable, according to Brassington, is for ExxonMobil to be able to deliver the rich gas by 2024 and the remaining facilities coming online by 2025 “by which time we would be able to deliver dry gas.”

ExxonMobil, he said, will be looking to begin placing orders for the pipes and ancillary material for the laying of the gas conduit from the Liza Fields in the Stabroek Block to the Wales Development Zone.

That will be paid for using cost oil while government will be financing the power plant from the treasury which, this year, benefited from the oil revenues had as a country between 2019 and last year.

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