Last Updated on Friday, 9 December 2022, 15:59 by Denis Chabrol
Guyana on Friday announced that after negotiations with the American-owned CH4/ LINDSAYCA, that company has been confirmed to build the natural gas-fired electricity plant and natural gas liquids plant at a reduced cost of US$759 million.
The first payment would come from GY$20 billion in the 2022 National Budget and the remainder would be a loan from the United States Export-Import Bank, he said.
CH4/ LINDSAYCA had bid to build the facility for US$899 million under an Engineering, Procurement and Construction contract, but Vice President Bharat Jagdeo said a number of aspects of the original bid have been erased during the negotiations and that has led to a slash in the price. “A number of things in the LINDSAYCA bid- they had provisions for a number of things that were not required as part of tghe manufacturers requirement so those were removed,” he said.
Mr Jagdeo said the American companies were picked after their bid was analysed by evaluators.
The second ranked bidder, PowerChina, had offered to build the facility at Wales, West Bank Demerara for US$704 million.
Mr Jagdeo said CH4/ LINDSAYCA was the only company that said it could meet the December 2024 deadline to construct the plants. Failure to do so, he said, would see the company facing “huge penalties” for each day there is a delay. “That was one of the attractiveness of the LINDSAYCA bid; they were the only one at the beginning who met the schedule and so we are extremely pleased that this week we have finally wrapped these up soi that the mobilisation could be made,” he said.
“We are on the way to the construction of the government-owned electricity plant that will transform Guyana in terms of stable power, in terms of cost of power,” at 4 US cents to 5 US cents per kilowatt hour which would be sold at 15 US cents per kilowatt hour, he told a news conference. Guyanese are currently paying 30 US cents to 25 US cents per kilowatt hour.
He again touted the natural gas liquids plant as one that would see Guyana shifting from being a cooking gas importer to an exporter fr0m which some of the revenues would be used to pay back for the infrastructure, maintenance and operation costs. Prior to Friday’s announced confirmation that CH4/ LINDSAYCA was selected, United States Ambassador to Guyana Sarah Ann-Lynch told the Guyana Manufacturers and Services Association (GMSA) awards ceremony on November 29 that said “I am also excited that a consortium of companies from the United States will be assisting with this transformational project,” he said.
“We know that reliable, cheap electricity matters, which is why selecting the U.S. consortium of CH4 and LINDSAYCA – a consortium of U.S. companies that brings quality and excellence to all that they do – to build the Gas to Energy project will unlock future economic development and diversification of Guyana, for all Guyanese,” she added.
According to the American envoy, the US would now e working on Guyana’s largest onshore-infrastructure project, “which is only fitting because we are also your lead development partner offshore!.”