Guyana Delays $1.9 Billion Gas-to-Power Project Until 2025, including 140 miles of pipeline

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Guyana Delays $1.9 Billion Gas-to-Power Project Until 2025, including 140 miles of pipeline

Guyana on the map (© Shutterstock/hyotographics)
Guyana on the map (© Shutterstock/hyotographics)

Guyana's ambitious gas-to-power project, aimed at reducing electricity costs and capitalizing on the country's energy resources, has been delayed until 2025, Reuters reported on Wednesday, Feb. 21, 2024.

According to the report, a government consultant confirmed on Tuesday, that the $1.9 billion project, initially scheduled for completion this year, will now not be fully operational until the fourth quarter of 2025.

According to Winston Brassington, a government consultant involved in the project, the delay is attributed to work delays, late equipment deliveries, and foundation issues at the chosen site.

The project, a key election promise to Guyana's 800,000 residents, aimed to cut their energy costs by 50% this year by utilizing the country's untapped natural gas reserves. However, these setbacks will postpone the anticipated cost reduction.

In terms of scope, the gas-to-power project involves constructing a 140-mile (225 km) pipeline, a gas processing facility, and a 300-megawatt (MW) combined-cycle power plant. Guyana is seeking a $646 million loan from the Export-Import Bank of the United States to finance the onshore facilities.

Exxon Mobil Corp is currently building the $1 billion pipeline, with reimbursement expected from Guyana's offshore oil production. The company and its partners will receive a fixed payment of $55 million annually for 20 years, totaling $1.1 billion, according to Brassington.

While the pipeline is expected to be completed by the end of this year, Brassington said the power plant will begin delivering 200 MW by June 2025, with full 300 MW capacity achieved only by the end of 2025.

Despite the delay, the government remains committed to harnessing its energy resources to benefit its citizens and economy.

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