A depiction of the Gas-to-Energy Project at Wales
Even as construction continues on its model Gas-to-Energy (GtE) project, the Guyana Government is already forging ahead with Phase Two of that initiative which could see a second power plant and Natural Gas Liquids (NGL) facility at Wales, West Bank Demerara (WBD).
Under Phase One of the Gas-to-Energy project, an Integrated Natural Gas Liquids facility and a 300-megawatt (MW) combined cycle power plant are being constructed at Wales and will use the rich gas that will be piped from the Liza Phase I and II projects in the Stabroek Block, offshore Guyana.
ExxonMobil, the operator of the oil-rich Stabroek Block, is laying 250 kilometres of 12-inch pipelines that will bring the gas onshore. However, only 40 per cent of the pipeline’s capacity will be used in Phase One to gas up the current power plant and NGL facility at Wales, bringing 50 million standard cubic feet per day (mmscfd) of dry gas onshore.
But with the pipelines having the capacity to push as much as 120 mmscfd of gas, the Government is now moving ahead with Phase Two of the Gas-to-Energy project that will utilise the remaining 60 per cent capacity of the pipeline and will see an additional 75 million cubic feet per day (mmcfd) of rich gas brought onshore.
Consequently, qualified firms are invited to respond to a Request for Proposals (RFP) to “design, finance, and operate” Phase II of the Gas-to-Energy Project based on a 20-to-25-year Power Purchase Agreement (PPA).
This second phase includes the design, construction, and operation of a 250 MW combined-cycle power plant, to deliver 2,100 gigawatt/hours of electricity per annum, and sold to the Guyana Power and Light (GPL) Inc. It also caters for the design, construction and operation of another NGL facility to produce at approximately 6,000 barrels per day of NGL products such as propane, butane, and C5+gasolene.
Additionally, Phase II also includes the transfer, at no cost, of excess “lean gas” estimated at 30 mmcfd, for utilisation in downstream industries, e.g. fertilizer production, to be located at Wales.
Based on the RPF document, the Phase II projects will be located on no more than 100 acres of land, immediately adjacent to the existing 300 MW Integrated facility at Wales and will be 100 per cent owned and financed by the private sector – similar to or exceeds the project finance structure of Phase I of the GtE project.
It was noted that only firms (consortia) adjudged to be experienced in Engineering Procurement and Construction (EPC) and Financing of comparable facilities, will be evaluated. The government also said it intends to appoint an independent supervision firm to ensure the project is built per approved contract quality and specifications.
Additional details are outlined in the RFP document, which can be obtained from the Permanent Secretary of the Prime Minister’s Office at a fee of $25,000.
Interested parties must submit their proposals, which have to include financial projections of revenue, expenses, and investment returns, by 2 PM on November 14, 2024, to the National Procurement and Tender Board Administration (NPTAB).
This move to establish a second power plant at Wales is part of the People’s Progressive Party/Civic (PPP/C) Government’s efforts to transition to clean energy, slash the costs of electricity and provide reliable energy sources for the country’s booming economy.
In the Stabroek Block, some 17 trillion cubic feet of gas have already been found, with the Pluma and Haimara wells being proven gas fields. The Guyana Government is seeking to develop this gas.
Back in 2019 and 2023, ExxonMobil drilled for gas at the Haimara-1 and 2 wells, and emerged with varying degrees of success. It was recently revealed that the US oil giant’s drill programme for Guyana for this year and beyond includes plans to further appraise the Haimara 3 and 4 well sites to gauge the commercial potential for gas in the Haimara gas field.
The PPP/C Administration is adamant that Guyana cannot miss this opportunity to monetise its gas resources.
Only in July, Vice President Dr Bharrat Jagdeo had disclosed the government’s second major gas project could be in Berbice, as he highlighted that the oil and gas sector will gradually shift to the East Berbice-Corentyne region (Region Six) over the coming years.
“Maybe if the second monetisation of the gas project comes on shore, it will come onshore in Berbice …because that’s the ideal location given that more of our gas finds have been in the Haimara area and Pluma,” he had stated.
Already, the Government has gone ahead and selected a United States-based energy firm – Fulcrum LNG Inc., to work in a tripartite arrangement with ExxonMobil and a state-appointed technical team to determine the viability of developing the country’s gas resources.
However, the Vice President further stated at a subsequent press conference last month that no project has been identified as yet and that the parties will have to come up with a proposal and look at the technical and financial viability of that project.
