Despite the formation of a new company – the Guyana Power and Gas Incorporated – the government has clarified that the country’s main electricity generating company – Guyana Power and Light – remains responsible for administering the forthcoming Gas-to-Energy project at Wales, West Bank Demerara (WBD).
On Thursday, in response to questions from the News Room, Vice President Dr. Bharrat Jagdeo said the new Guyana Power and Gas Inc. is simply a holding company and will actually become part of GPL.
The new company, Jagdeo also noted, is 100 per cent owned by the State.
“It is just a legal vehicle for the project.
“Sometimes you need a legal vehicle to develop a project,” Jagdeo said in the first public statement from a government official about the company.
Information about the company was released by the Indian Ministry of Petroleum and Natural Gas and Housing and Urban Affairs when a contract was inked in January between Engineers India Limited.
Jagdeo said because of the nature of the company, all directors will be government officials for now.
Director of Projects in the Office of the President, Marcia Nadir-Sharma had signed as director of the new company on the agreement in India.
“It will become part of GPL.
“You can have several companies owned by the government but GPL is getting the power and utilising it,” Jagdeo said at a press conference on Thursday.
One day earlier, Deputy Chief Executive Officer of GPL, Renford Homer offered his understanding of the arrangement with the new company.
“What I can tell you is that GPL is the sole off-taker of the power that is going to be generated…that company (Guyana Power and Gas Inc) is meant to have responsibility largely over the facility,” Homer said.
According to him, the natural gas-fired power plant and the natural gas liquids (NGL) plant to be constructed at Wales will fall under the management of this new company.
“One would expect that there will be some sort of power purchasing agreement between the two entities, of course with the approval of the PUC when it gets to that point.
“All of that has not been concretised but if you look at the broader model, that is where it seems to be going,” Homer added.
The Gas-to-Energy project promises the delivery of cheaper electricity and large amounts of cooking gas to Guyanese. It is set to become the largest project in Guyana.
In December, a contract was inked for the engineering, procurement and construction of the Guyana-integrated natural gas liquid plant and a 300-megawatt power plant.
The signing between the Government of Guyana and US-based integrated energy solutions group – LINDSAYCA – in partnership with a local firm – CH4 Group – took place at the Office of the President in Georgetown.
Overall, the project, which is pegged at more than US$1 billion, will feature approximately 220 kilometres of a subsea pipeline offshore from the Liza Destiny and Liza Unity Floating Production, Storage and Offloading (FPSO) vessels in the Stabroek Block to onshore.
That allows natural produced in oilfields offshore to be harnessed at the Wales power plant.