The Opposition APNU+AFC is contending that the gas-to-shore project, slated for Wales, West Bank Demerara is not viable, adding that it is in possession of studies to support its contention.
The claim was made yesterday at a press conference by Leader of the Opposition Aubrey Norton and his economic advisor Elson Low. However, Norton declined to share specifics of the study or say what they found to lead them to the conclusion that the project is not viable.
“We have a number of people researching and the research is showing that [the gas to shore project] is not viable and therefore we will continue to expose the fact that it is not viable and take political action…we are clear as ever based on the research that was done that the gas to shore programme as presently constituted at the present venue is not viable and feasible, and therefore should not really go ahead,” Norton said.
When asked to share specifics of his findings, Norton said “…that has nothing to do with what our studies have shown. If you had a project that was aimed at one place, and then you move it to another place then the very act of moving it demands a new feasibility study and that’s the point we are making.”
The pipeline is expected to be landed at Crane/Nouvelle Flanders, West Coast Demerara, and run to Wales on the West Bank of Demerara, where a natural gas liquids (NGL) processing plant and power plant are to be constructed. ExxonMobil is responsible for the construction of the pipeline while it is the government’s task to construct the plant.
The project involves capturing associated gas produced from crude oil production operations on the Liza Phase 1 (Destiny), and Liza Phase 2 (Unity), Floating, Production, Storage and Offloading (FPSO) vessels.
Some 150 acres of land at Wales have been allocated for the project, which is expected to cut power costs by 50 per cent. The government’s power plant is expected to utilise ‘dry gas’ for electricity generation.
A 2017 study identified Clonbrook, Mahaica on the East Coast of Demerara, as the best location for bringing natural gas to shore for domestic use. That study was conducted during the APNU+AFC’s tenure in office.
Sticking to that location, Norton said that the government has not yet explained nor provided any feasibility study to support the move of the NGL plant to Wales. He argued that the government cannot use an old feasibility study as the basis for selecting Wales as the best location for the NGL plant.
“First of all, environmentally, it is different, and therefore there’s a need for an environmental impact assessment. We’ve already said that the pipe will have to be longer, and more work will have to be done to get it there. So there is additional costs. It doesn’t take a rocket scientist to tell you that once you are moving [locations] then almost immediately you have to have a new feasibility study, a new impact study,” Norton posited while still refusing to provide information about what his studies have unearthed.
Backed by Low, Norton maintained that no environmental studies were conducted on either the pipeline or the plant. However, ExxonMobil actually conducted and submitted an EIA to the Environmental Protection Agency for the route of the pipeline.
Norton told reporters that the government has no intention to bring the cost of power down. He said that if elected, an APNU+AFC government would implement a plethora of measures that will reduce the cost of energy.
“Research is showing that solar is now coming in at a cheaper cost and therefore solar will be one option. They are areas of research that we would have established that in some areas wind might be an option and then there are areas in which hydro is a possibility.
“What we intend to do is to continue to do the research and ensure at the end of the day, we have a combination of approaches based on the area that is …best suited … and once we can do that we’ll be able to bring down the costs of electricity,” he said.
The pipeline project aims to employ approximately 800 workers during the peak construction stage and 40 full-time workers during the operation phase.
It will be executed in three phases – construction, operation, and decommissioning. It entails three aspects as well – an offshore pipeline which is approximately 220 kilometres of a subsea pipeline extending from new subsea tie-ins at the Destiny and Unity FPSOs in the Stabroek Block, to the proposed shore landing located approximately 3.5 kilometres west of the mouth of the Demerara River; an onshore pipeline that is a continuation of the offshore line and extends about 25 kilometres from the landing site to the NGL plant; and the NGL plant and associated infrastructure that will be located about 23 kilometres upstream from the mouth of the Demerara River on the west bank.
Both the Destiny and Unity FPSOs have pre-installed facilities to allow for the export of the associated gas with crude production.
At the end of July, ExxonMobil announced that it had made a contingent award of the contract for the construction of the pipeline.
The consortium of Subsea 7 and Van Oord, announced that it had received a “substantial” contract from ExxonMobil affiliate, Esso Exploration and Production Guyana Limited (EEPGL), for the gas-to-shore project. Subsea 7 said that it considers a “substantial” contract to be in the vicinity of US$150–300 million.
The company informed that the scope of the contract covers the project management, engineering, and installation of approximately 190 kilometres of pipeline, with an associated shallow water portion and onshore approach making landfall to the west of the Demerara River, along the coast of Guyana.
Government has already met with persons occupying land in the path of the pipeline and is discussing compensation and relocation, while Exxon has already awarded the contract for the construction of the pipeline. All of this is being done in the absence of an environmental permit which is yet to be issued by the EPA.
