Dear Editor,
I wish to take advantage of Sithe’s presence in Guyana to put some pertinent questions to them and the government in connection with the Amaila Falls Hydro Project. The reason I am using this medium is dictated by the fear that I would not be able to pose these questions at the so-called consultation at the Convention Centre.
These are:
1. Who now owns the licence? And how much was paid to Fip Motilall for it and is there an expiry date of the licence? And what is it?
2. Have all the terms of the interim licence been complied with faithfully? If not, why not?
3. What is the total equity contribution of Sithe to the deal? How much is Sithe’s own money? Is this in real cash or services already rendered? How much of it is in services?
4. Is Sithe borrowing money from IDB for this project? How much and on what terms? What is the interest rate? Is Sithe or IDB seeking a Government of Guyana guarantee for this loan?
Is this provoking an increase in the debt ceiling? Are Sithe and IDB aware of the legal limitations on the government guarantee for borrowing?
5. Is Sithe willing to produce its calculations and projections showing a reduction in tariffs? What is the total in US dollars that GPL would have to pay over 20 years on the PPA?
6. What exchange rate on the US dollar is projected in year 5, year 10, 15 and 20?
7. Is Sithe depending on all or most of the major self-generators, DDL, Banks DIH etc, returning to the GPL Grid? What is the projected demand – year 5, 10, 15 and 20? What is the projected final cost of GPL areas not being served by the projected Hydro?
8. What is to happen when there are blackouts from Amaila?
9. Why is Sithe being allocated majority equity portion and control of the company with a minority equity contribution?
10. How many directors will be on the Board of the company and how is this distributed between the government and Sithe? How are the senior management positions distributed?
11. Where is the evidence that GPL is in a position to handle this project? What are the projected system losses for GPL in year 5, 10, 15 and 20?
12. Who will oversee tariff settings by GPL?
13. What is the guaranteed rate of return for Sithe over 20 years?
In percentage terms and in US dollars terms? Is Sithe’s original capital contribution, if any, being repaid separately over this period?
14. By what bidding process were Sithe and China Railway selected for this project?
15. Who really picks up the costs for the failure of this project?
Yours faithfully,
Ramon Gaskin
