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David Patterson

David Patterson

April 30, 2021

Source

-insists that detailed studies needed



The Alliance For Change (AFC) today said that it supports the project to bring associated gas from Guyana’s oil well to shore for energy generation but it argued that the PPP/C government’s plan is not sound and requires further detailed studies lest the country is saddled with the largest ever white elephant.

In a statement today, the AFC noted that the government was relying on studies which had been developed during the last administration in which the AFC was a coalition partner of APNU.

Delivering a statement at an AFC press conference, former Minister of Public Infrastructure David Patterson said that the government had culled selectively from the reports and importantly Wales, West Bank Demerara had been rejected in the consideration of the possible sites. The PPP/C government has been adamant that it will site the gas to shore project at Wales.

The statement made by Patterson follows:

The AFC notes with satisfaction that the PPP has acknowledged the depth and quality of the studies undertaken during the Coalition’s stewardship of the Oil and Gas sector and had to begrudgingly confess that they have based their decision to bring gas to shore, solely on the studies undertaken during the coalition administration. However, we noted that they have deliberately only highlighted the sections of these studies that lent support to their unilaterally selected site, while ignoring other relevant and critical aspects of these studies. Irrespective of the basis, this decision to locate the gas site at Wales, is premature, incomplete, and requires additional detailed studies.

Importantly, none of the studies commissioned under the coalition administration recommends the site selected by the PPP, nor even supports the costs the PPP are now associating with the gas to shore project. As a matter of fact, it is important to note that Wales was considered among 10 sites but rejected in the studies. A Value for Money audit should be undertaken to determine the viability of the proposed costs of constructing an onshore pipeline for US$80M – US$100M as opposed to selecting a site closer to the coastline, and using these sums to do site clearance, protection, and filling. Conservative estimates indicate that such an approach will be far more cost effective.

The PPP claims that urea will be a byproduct at the stated volume of gas (50mfd). This claim is not supported by any of the studies. In fact, the studies state that for urea production, a minimum excess amount gas of 74mfd will be required. The projected excess amount of gas after utilization for power production is calculated at 15mfd – which makes it uneconomical and impracticable – yet the PPP has used this promise as one of their justifications for moving ahead with the gas to shore project. We reiterate that more studies are needed on this project concept!

The PPP has presented a proposal to install a Liquefied Natural Gas (LNG) plant which it is claimed will produce approximately 3,400 barrels per day. Noting that in 2020, Guyana’s total Liquefied Petroleum Gas (LPG) usage was approximately only 2,000 barrels per day, they have decided on a plant without the provision of any plans for utilization of the excess volumes. The studies clearly state that exporting this small amount is not economically viable. Under the Coalition government, studies had commenced to assess the possibilities of powering our revised public transportation system with excess gas. Unless such studies are completed, any decisions on the gas to shore project remain premature and incomplete.

The projected costs of US$900M is exclusive of costs for power generating plants as well as transmission of the power to GPL power distribution stations. The studies utilized by the PPP listed the costs for the power plants and transmission lines to be US$240M and US$85M respectively – which would make the total project cost approximately – US$1.225B. This astonishing sum will be added to Exxon’s cost recovery total during the next four years, thus further delaying the opportunity for our country’s citizens to benefit from our natural resources.

What should be of great interest to the Guyanese public, is that using these same studies, the Coalition government planned to deliver a project that produced 188MW of power plus 2,200 barrels of LNG daily for a price tag of under US$600M – half the amount that the PPP is demanding, and they have shown no additional value as a justification for these huge increases in expenditure – other than the typical “Money for the Boys”.

Further, based on the studies, the quantity of gas (50mfd) being proposed to be utilized by the PPP will only be guaranteed available for 11 years, while the 30mfd will be fully available for 18 years. The Coalition based our decision to utilize the lower quantity of 30mfd, not only because of cost but more so, because of our commitment to transition the country to one hundred percent renewables by 2040.  The Power Generation Study completed by the Coalition, provided a roadmap to this transition, with the introduction of a mid-scale hydro plant project by 2030. The decision to expend an additional US$600M at the expense of six years guaranteed gas supply is quite frankly – “voodoo economics”.

The AFC supports a gas to shore project, however the project proposed by the PPP is not economically or environmentally sound or sustainable. We therefore demand that further detailed studies be conducted before the country is saddled with its largest ever PPP white elephant.

Replies sorted oldest to newest

How much will it cost GPL if it continues without the g-t-s compared to the cost of the g-t-s? What would GPL gain by having the g-t-s? What would happen after g-t-s has outlived its usefulness? Would Guyana be into renewables by then? Why not now? I'm still into my call for a refinery! Large economies like the US, China, India, Russia are not abandoning oil anytime soon, regardless of talk about greening the planet! Is Brazil or S. Africa abandoning oil? Nigeria? As Keynes said, "In the long run, we're all dead, anyway!"

FM

Now that it has been confirmed that the PPP has not commissioned any additional studies on the gas to shore project but have utilized studies commissioned by the coalition administration to justify their overpriced, ill-conceived, proposal to locate this project in Wales, the timing is perfect to shed some further light on this decision.
Exxon commissioned an independent consultancy firm ERM, who calls itself “The world’s leading sustainability consultancy” firm to provide an expert opinion on suitable locations for the gas to shore project. Exxon and ERM ruled out the Wales location as suitable (see page 6). However, despite this, and with no additional studies, the PPP is ‘gong ho’ on using the Wales location.
But hey, don’t take my word for it on this issue, read the report for yourself (apologies for the quality of the copies, but one must work with the tools available). Included in the attachments, is a list of additional studies that were proposed to be executed before a final decision on a location was made.
At a price tag of US$1.225B (US$900M for the pipeline and LPG plant, US$240M for the power plants, and US$80M for GPL infrastructure), this will be the largest white elephant project in the Caribbean. What’s even more astounding is that gas at the quantity proposed by the PPP will only be available for 11 years. That’s correct folks, we will be paying US$112M per year for this PPP project for a lifespan of eleven years – makes any sense to you???
Just in case, I cause any PPP member any “emotional distress”, I have tagged the big guy on this post – he might have a busy weekend!!!
Django
@Prashad posted:

AFC has become a lick PNC bum party.

the PPP has acknowledged the depth and quality of the studies undertaken during the Coalition’s stewardship of the Oil and Gas sector and had to begrudgingly confess that they have based their decision to bring gas to shore, solely on the studies undertaken during the coalition administration.

Mitwah
@Ramakant-P posted:

The AFC and APNU like to prattle too much. They never like to do anything because of the fear of failure. That's why they never did achieve anything.

They complain a lot about nothing.

Why don't you shut your Kant, kunt?

FM
@Prashad posted:

AFC has become a lick PNC bum party.

@Mitwah posted:

the PPP has acknowledged the depth and quality of the studies undertaken during the Coalition’s stewardship of the Oil and Gas sector and had to begrudgingly confess that they have based their decision to bring gas to shore, solely on the studies undertaken during the coalition administration.

Seems the PPP has become a lick Coalition bum party now. Wuh you say deh Prashadski?

cain
Last edited by cain
@Ramakant-P posted:

The AFC and APNU like to prattle too much. They never like to do anything because of the fear of failure. That's why they never did achieve anything.

They complain a lot about nothing.

You read the above?

cain

The issue here is about the AFC's support for the gas to shore project. They provide a feasibility study on the project but they are not sure that the Plann the PPP is implementing is sound. They want the PPP to redo the study and waste taxpayers' money. As I said before they complain about nothing. They never achieving anything when they were running the country. It looks like the math employed here is above their heads.

R
@Ramakant-P posted:

The issue here is about the AFC's support for the gas to shore project. They provide a feasibility study on the project but they are not sure that the Plann the PPP is implementing is sound. They want the PPP to redo the study and waste taxpayers' money. As I said before they complain about nothing. They never achieving anything when they were running the country. It looks like the math employed here is above their heads.

Your bigoted head, too!

FM
@Ramakant-P posted:

The issue here is about the AFC's support for the gas to shore project. They provide a feasibility study on the project but they are not sure that the Plann the PPP is implementing is sound. They want the PPP to redo the study and waste taxpayers' money. As I said before they complain about nothing. They never achieving anything when they were running the country. It looks like the math employed here is above their heads.

Your bigoted head, too!

What is "bigoted head"? Where is the bigotry in my post?
R

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