PM says gas-to-energy project will be the backbone of a stronger economy
Prime Minister Brigadier (Ret’d) Mark Phillips has said that the Gas-to-energy (GTE) project in Wales on the West Bank of Demerara (WBD) will strengthen the economy and prepare it to compete on the global stage. He made these remarks on site while observing the signing of the Term Sheet for the US$527 million loan, which the United States EXIM Bank approved.
“This is indeed a most transformative project, and it is the largest project in terms of size and financing that is embarked upon by the Government of Guyana in the history of Guyana, the Prime Minister stated.
He added, “This is the moment that speaks to the power of vision, the strength of partnership, and the enormous possibilities [that] can arise with shared purpose.”
He emphasised further that signing the agreement between the Government of Guyana and the US EXIM Bank is a declaration of trust in Guyana’s potential and a commitment to shaping Guyana’s future. Before signing the agreement, Senior Finance Minister Dr. Ashni Singh said that the US EXIM Bank’s financing of the Gas to Energy project testifies to the enduring strength of the US/Guyana relationship.
He alluded further to the transformative nature of the project and the special relationship Guyana shares with the US. He noted that the historic transaction paves the way for many more and is a good example of what can be achieved through partnerships such as that between the US and Guyana.
The finance minister recalled his first meeting with the US EXIM Bank Chair in April 2022. He noted that it was only months later that the Government and the bank signed a Memorandum of Understanding (MOU) under which EXIM agreed to make available an aggregate exposure of 2 billion US dollars to Guyana.
“Notwithstanding that, during the course of this journey, it felt sometimes that we were not getting it as quickly as we wanted to, but the reality is that moving from zero to half a billion in two and a half years really is a remarkable achievement,” Dr. Singh added, based on which he thanked all parties concerned in bringing the project to the point it had reached.
Dr. Singh also encouraged the local private sector businesses to avail themselves of the various tools, instruments, and products that are offered by the US EXIM bank while restating that Guyana is open for business and further indicating that Guyana would like to see more US companies doing business in Guyana and with Guyanese businesses.
Delivering remarks during the signing, US EXIM Bank’s President and Chair Reta Jo Lewis said Guyana’s economy has continued to grow and prosper. She also highlighted that the EXIM Bank Board unanimously approved the over half-billion-dollar financing for the transformative Gas to Energy project, which she said is a game-changer not only for Guyana and the United States but also for the people, businesses, and shared aspirations that unite the two nations.
She added, ‘Together, we are taking bold steps to strengthen energy and security, enhance environmental sustainability, and unlock economic opportunity.’
In October last, President Irfaan Ali, during his address to the National Assembly, pointed out that in keeping with his government’s commitment to reduce the cost of electricity, the Government would be reducing by 50 per cent the cost of electricity for every consumer in Guyana.
The Head of State explained further that the Wales development hub is an integral part of the energy equation and consumption as it will create opportunities for industry, agro-processing, and manufacturing, create new jobs, and expand the country’s economic base.
In the country’s 2024 budget, $80 billion was allocated to advance the project and its associated infrastructure, including transmission and distribution upgrades to offtake the power during the construction of the power plant.
The project will see a 200-kilometre pipeline bringing gas from the Liza Destiny and Liza Unity Floating Production fields onshore. The pipeline will continue for approximately 25 kilometres to the Natural Gas Liquid (NGL) plant to be constructed in Wales.
The complete project will result in several benefits for Guyanese, including job creation, improved electricity access, foreign investment, and energy security. In 2022, Guyana and the US EXIM Bank signed a historic US$2 billion Memorandum of Understanding under which the parties agreed to explore options for utilizing the bank’s standard instruments, including direct loans and medium- and long-term guarantees, and for the financing of US exports to Guyana for Government projects.
The MOU represented an important milestone in US-Guyana relations, laying the foundation for Guyana to access financing and facilities from the EXIM bank for the first time and providing for interventions at a scale likely to have a lasting developmental impact.
