Wednesday, November 30, 2022

Guyana now offering land for 30,000 bpd oil refinery

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OilNOW
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The Guyana government on Friday took another historic step toward the nation’s energy independence as it issued a Request for Proposals (RFP) from interested parties for the design, financing, and construction of a 30,000 barrel per day (b/d) oil refinery.

The facility would be located on land provided by the government at the mouth of the Berbice River in the vicinity of ‘Crab Island’.

The government said it expects construction to start by the first quarter of 2023 with project completion no later than 2-years after the start date.

In addition to providing an estimated 30 acres of land, the government said it will also offer generous fiscal incentives for the project including a 10-year tax holiday, supply of feedstock (oil) from the Guyana government’s share of profit oil at market prices; and access to the domestic market for the sale of refined products (if desired).

It was keen to note that this project will be strictly financed and owned 100% by the private sector. The RFP explicitly stated that government will not have any ownership or investment interest in the project.

Small refinery for Guyana could make a big difference for energy security – VP | OilNOW

According to the criteria, the developer’s capability and credibility to execute such a project would be thoroughly scrutinised.

Submissions should include a detailed track record of similar projects completed, showing the role played in design, financing, and construction, date of the project start, date of completion, capacity (b/d), and total budget.

Evidence of financial ability, including the last 3 years of audited Financial Statements, and details/evidence of financing for this project from own resources or third-party resources, are also required.

Importantly, the government said bidders must show project costs (lump sum), detailing all capital costs (broken down into sufficient detail), financing costs, supervision costs, development costs, and all other costs to date of commissioning/commercial operations.

With the volatility of oil and gas prices this year, the need for a small refinery has become even more topical in the public domain. Geopolitical conflict continues to be waged among world powers, and the government has been urged to put measures in place to cushion the population from the resulting negative effects.

Vice President Dr. Bharrat Jagdeo has said that a small refinery would make a big difference for Guyana.

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