(INEWS)In excess of $400 million has been set aside to provide compensation for persons living along the path where the gas-to-energy project will be constructed.
Head of Guyana’s Gas-to-Energy Taskforce, Winston Brassington, made the disclosure during day two of the International Energy Conference and Expo, at the Marriott Hotel on Wednesday.
He said some 75 acres of land have been acquired from 65 persons, paving the way for the commencement of the pipeline construction.
From its inception, the government made a commitment to ensure that agreements are made with the residents.
The path that has to be cleared for the pipelines is in the vicinity of Nouvelle Flanders, West Coast Demerara, to Wales, West Bank Demerara.
Meanwhile, Brassington explained that the government will pay ExxonMobil an annual fixed sum of $55 million over a 20-year period from the time the project comes onstream.
The project is intended to supply 50 million cubic feet of gas per day from the Liza Facility to the Wales Development Zone.
“This payment is intended to allow Exxon to recover the expected $1 billion investment over time. So, we are paying for the amortisation of the pipeline infrastructure, and not the gas, which is considered free. These $1 billion covers everything that Exxon will spend on the pipeline,” Brassington disclosed.
Therefore, the money includes the cost of laying the pipeline, as well as other endorsing works, such as the upgrading of roads and bridges to improve access to the sites, the establishment of a material offloading facility, site preparations of 100 yards, and contingency works.
“We believe that this $1 billion will be adequate to get this project done, particularly given that almost all the works have already been awarded,” Brassington noted.
Further, to facilitate the viability of the project, Brassington explained that the country’s transmission network must be improved. This means that Guyana’s current electricity grid will be improved by 300 megawatts coming from Wales.
The gas-to-energy project will entail over 200km of an offshore pipeline bringing gas from the Liza Destiny and Liza Unity Floating Production fields onshore.
Upon arrival at this West Coast Demerara facility, the pipeline will continue for approximately 25 kilometres to the Natural Gas Liquid (NGL) plant to be constructed in Wales.
It is expected to have a 25-year lifespan and will bring a plethora of benefits to Guyanese, including job creation, improved electricity access, foreign investment, and energy security.
The 2023 budget allocated some $43.4 billion for the project which is set to significantly lower the cost of electricity, triggering rapid growth in industrial activity, and promoting a smooth transition to renewable energy sources countrywide.