GUYANA – Hess, ExxonMobil and CNOOC – co-venture partners on the Stabroek Block – recently finalized an agreement with the Government of Guyana for a Gas to Energy project. The project will enable Guyana to shift from the imported heavy fuel oil currently used for the majority of its power generation to natural gas supplied from the Stabroek Block that is lower cost, cleaner and more reliable.
The agreement calls for the companies to construct a 12 inch diameter ~200-kilometer (140 mile) natural gas pipeline from the offshore assets in the Stabroek Block to a special industrial zone in Wales on the West Bank of Demerara. There, a natural gas liquids facility and power plant will be built to bring to land 50 million standard cubic feet per day of natural gas for generating 300 megawatts of electricity. Click here for video.
Reducing Energy Costs
Speaking at the Heads of Agreement signing ceremony, Guyanese President Ali said that that the Gas to Energy project had the potential to be transformational for Guyana.
The Gas to Energy Project will enable electricity costs to fall by more than 50% with additional gas left over for industrial uses,” he said. “Every single month Guyana will save US $11 million that is used to pay for fuel.”
President Ali noted that these savings would free up revenues that could be invested to help eliminate hunger, develop infrastructure, and expedite programs to improve education, health and social security.
Improving Reliability in Power Generation
Speaking on the sidelines of the signing ceremony, Tim Chisholm, Hess Vice President for Guyana & Suriname, noted that the Gas to Energy Project would not only power industry and economic growth in Guyana but would help provide a reliable and cleaner source of energy to help meet rapidly growing demand for electricity.
“Demand in Guyana is expected to triple in the next five years as the economy continues its fast-paced growth. Natural gas can not only provide a secure and reliable source of energy supply but brings with it important environmental benefits,” he said.
Reducing Carbon Emissions
Chisholm noted that more than 90% of Guyana’s power generation capacity comes from heavy fuel oil, an energy intensive and high emissions fuel.
“This project will deliver clean burning natural gas to Guyana, reducing carbon emissions by up to 50%,” Chisholm said. “It is a win-win for the environment and for economic development.”
A Transformative Future
“This [Gas to Energy Project] is a project that cannot be evaluated or written about in the narrow sense of a power plant,” Guyana President Ali emphasized. “It is national and transformative in nature and cuts across various sectors. Through this project there is a prosperous road ahead,” he predicted.