Guyana’s Natural Resources Minister, Vickram Bharrat is adamant that the Wales gas-to-shore project will not only benefit those in the country through affordable electricity, but it will also attract wealthy international investors to the nation’s shores.
The Natural Resources Minister noted that the electricity cost in Guyana, pegged at US$0.30 per kWh, is relatively high. He explained that this is primarily due to the exorbitant cost associated with generating the power.
“As it is now, if a company wants to come to the Caribbean, or to South America to do, let’s say, canned cherries, when they look at the electricity cost in Guyana, and you compare it with Trinidad or Suriname, those countries are way cheaper,” Mr. Bharrat said during a recent interview.
Singling out Trinidad & Tobago which has managed extensive gas reserves for decades, Bharrat said, “They use gas, and they pay about US$0.12 per kWh, which is very cheap; less than half of what we pay in Guyana. So that is where we are moving as a country and as a Ministry, to ensure that we utilize the gas to produce electricity, and to produce electricity, maybe at the cost of what Trinidad is producing.”
He posited that the opportunities for investment in the local economy will be significant, as it is only obvious that large conglomerates will go where they are sure they will make higher profits.
The local private sector has long complained about the cost of power in Guyana, and how it restrains their profit margins. In this regard, the Minister articulated, “Because some companies will tell you ‘We don’t go into value added products because the profit margin is small, because the electricity is expensive.’ But when electricity becomes cheap, then companies will want to invest in value added [products].” With this in mind, Mr. Bharrat said local companies will also be incentivised to make larger investments.
As the first of the new administration’s large-scale energy projects, the 300 MW plant, as it is intended to be designed, will supply around 250 MW of power.
Vice President, Dr. Bharrat Jagdeo expects that the partnership between Government and the ExxonMobil-led Stabroek block consortium will yield an operational gas-to-shore project by the end of 2023.