Guyana will save US$500 million annually from gas to shore project

Last Updated on Wednesday, 15 February 2023, 21:44 by Denis Chabrol

The US$1.7 billion gas-to-shore project, including the natural gas-fired power plant and natural gas liquids plant, is projected to save Guyana US$500 million annually after paying ExxonMobil US$55 million each year for the pipeline, Project Lead Winston Brassington said Wednesday.

“Exxon projects that the quality of the gas, which is a very high quality gas- rich gas, will remain stable over the life of the project,” he said.

With the power plant being designed to produce 300 megawatts, he said if Heavy Fuel Oil was used to generate that amount of electricity would cost at least US$500 million annually.

In giving an update on the gas-to-shore project at the Guyana Energy Conference, he said when the natural gas-fired power plant comes on stream in 2024, the country is expected to save US$390 million in Heavy Fuel Oil that the Guyana Power and Light (GPL) spent last year at a rate of 15 US cents per kilowatt hour.

Using the 2021 import cost of cooking gas (Liquid Propane Gas) price, Mr Brassington said Guyana could save US$100 million annually or US$150 million at the 2022 import price. He said the American firm, CH4/LINDSAYCA, that has been hired as the Engineering, Procurement and Construction (EPC) contractor has estimated that from the 50 million cubic feet of gas per day, 63 million barrels of liquids would be produced annually or 4,100 barrels per day.  He said currently, Guyana consumes 700 barrels of liquids per day “so will have quite a lot to export.”

The Project Lead for the gas-to-shore project said the US$55 million payment from cost oil to ExxonMobil for the 12 inch pipeline would be a “fixed price” for the next 20 years. “We believe that this US$1 billion will be adequate to get this project done particularly given that almost all of the works have been awarded,” he said.

He said the pipeline capacity would have a capacity of 120 million cubic feet per day of natural gas, though 50 million cubic feet per day would be supplied free of cost.

Government has set aside GY$400 million to pay 56 persons for a total of 75 acres of land along the route of the pipeline.

At a public meeting held on Wednesday night in North Ruimveldt, Opposition Leader Aubrey Norton again urged government to put all of the gas to shore documents in the public domain. They are actually on the Ministry of Natural Resources website. Mr Norton’s opposition coalition of A Partnership for National Unity+Alliance For Change has filed a motion in the National Assembly demanding that those documents be provided.