Norway US$80m could go to other energy projects if Amaila hydro does not go through -Jordan

The future of the Guyana-Norway forest protection agreement which has been mired in uncertainty was discussed at a meeting in Paris, France yesterday between the two countries and there was agreement that US$80m which had been earmarked for the Amaila hydro-power project could go to other energy initiatives in the event that the project doesn’t go ahead.

Held on the side lines of the 2015 Paris Climate Change Conference (COP21), the meeting was conducted in the presence of key representatives of the Inter-American Development Bank (IDB) with which the US$80M has been deposited. A Ministry of the Presidency release yesterday said that Minister of Governance Raphael Trotman reported that both parties agreed to formulate a document which will look at the future of the relationship and how best it can serve both countries.

The ground-breaking deal between Guyana and Norway in 2009 was meant to enable payments of US$50M per annum for five years based on performance relating to limiting emissions from deforestation and further decreasing forest degradation.

However, Guyana’s limited execution capacity has seen only a portion of the funds actually spent on projects, payments were reduced in several years for non-compliance and US$80m remains in limbo because of the controversy besetting the Amaila Falls project.

Minister of Finance, Winston Jordan, who is also attending the conference to aid in the negotiations for financing for Guyana, said that the meeting with the Norwegian delegation was fruitful for both sides.

“Our position remains the same, which is that the Amaila [Falls] conception [is flawed], we cannot go ahead with it. We think that it is too costly. It hasn’t been properly studied, it has environmental, engineering and other issues, and so what we are saying is that if those can be solved, we would be happy to reconsider the project and that is what we said in the meeting and it was accepted by all sides,” Jordan was reported in the press release as saying.

Last month, Jordan announced that the Norwegians would like to have an independent study conducted on the project so that it can be brought to finality but this is still to be decided on. The minister said in Paris yesterday that Guyana was particularly interested in how the US$80 million can be unlocked for the development of the country.

“We welcome that as it would bring some sort of finality. This will ensure that once for all, we will know if it’s viable and how can we find a sponsor and if it is not, how we can get the money to facilitate it. We got a confirmation in the meeting that this money (US$80 million) was for Amaila but if the Amaila does not go through, it can be channelled into clean and green energy initiatives,” Jordan said.

Guyana is expected to have follow-up meetings in January and Norway has invited the Guyana Government to send a team to the country for further discussions in June of 2016. However, the release said that Jordan noted that Guyana has made it clear that it would prefer timely discussions and has asked for all future actions to be placed in a timeframe.

“We made clear that these have to be time-bound. We just cannot sit and say six months or one year. We have to map out the steps that need to be taken and how long so that we can get to the final point,” he said.

Since the agreement was signed in 2009, Guyana has earned US$190 million. The Agreement comes to an end this year and an extension is up for discussion. Of the total amount, US $69.8 million has been transferred to the Guyana REDD+ Investment Fund (GRIF) while US$80 million was transferred to the IDB for the Amaila project.

Norway had strongly supported the Amaila project, which was the flagship project of the previous PPP/C administration’s Low Carbon Development Strategy and was envisioned to deliver a steady source of affordable, reliable, clean and renewable energy. The project was supposed to eliminate at least 92% of Guyana’s energy-related greenhouse gas emissions and it was said that this would likely make Guyana the world’s number one user of renewable energy by 2017.

 

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