President of ExxonMobil Guyana, Alistair Routledge told a news conference yesterday that preliminary works have begun along the route of the pipeline in the West Bank Demerara.
The Gas to Power project involves the construction of a 300mw combined cycle power plant and a natural gas to liquids facility.
Routledge said that in order to ensure the gas-to-energy plant begins electricity generation in 2024, the company has been pushing ahead with “early works”. Such effort includes the construction of roads, bridges and laydown areas on the West Bank Demerara.
The Guyana government has already contracted an American joint venture, CH/LindsayCA, to build the natural gas-fired electricity plant and the natural gas liquids plant for US$759 million.
Exxon and the Ministry of Natural Resources are currently engaged in a review of the Field Development Plan and the update to the licence for the Liza field. Routledge said that once this step was completed, the company would be able to make the final investment decision (FID) around requirements for the project to proceed.
As part of the project, Exxon would be selling the 50 million cubic feet of natural gas per day to the government entity for use at the electricity generation and natural gas liquids plants.
Furthermore, construction of a 200 kilometre long gas pipeline to bring the gas to shore will commence at a cost of approximately US$1b. Mr. Routledge said that gas sales will cover the cost of the infrastructure without profit, which means that it can deliver gas at a very low price to the country.
This falls in line with the government commitment amidst the energy boom to ensure the creation of prosperity (as outlined in the recent Energy Perspectives podcast featuring Dr. Peter Ramsaroop). Mr. Routledge further added that electricity produced by natural gas would cost 50 percent less than current fuels.
In November 2022, the Guyanese government green lit the project and at the time, President of Guyana, His Excellency Dr. Mohamed Irfaan Ali made it clear that the offshore gas drilling taking place at breakneck pace must benefit the Guyanese people as a whole and not just those connected to the business. This project, while stabilizing energy distribution in the region, will lead to lower energy costs, significantly while maximizing the use of by-products from drilling.