Low oil prices have significantly improved the fortunes of the Guyana Power and Light (GPL) which was once a financial “troublemaker” for the government.
Minister of Finance Winston Jordan told reporters at an end-of-year press conference yesterday that while the Guyana Sugar Corporation (GuySuCo) continues to be a drain on the public purse, GPL, which was a “troublemaker… has benefited from low oil prices.. that [has] allow[ed] them to recover their bottom line.”
He explained that the utility company has been able to make about $500 million worth of payments on the interest of the loans provided to it by the government.
Additionally, “they are budgeted to make $1 billion in transfers at the end of 2016… It’s a real turnaround from when we had to give them transfers, so now we’re re-transferring.”
Jordan acknowledged that with oil prices expected to rise in the near future this situation might change but said that government was “praying for the best.”
“Oil prices are expected to be higher this year than last year but we are hoping that production would be less than we have averaged,” he said.
Meanwhile, the minister took the time to praise the Guyana Oil Company (GuyOil) which he said has been performing “reasonably well.”
“They have benefited somewhat from price increases with time in the oil… they have been able to make dividend payments… $2 billion last year which came in very handy. This year they are expected to make another $1 billion which will come in handy also.”
“They are showing their worth… you need agencies like GuyOil to really give effect to policies of the government,” he added, explaining that unlike other agencies which approach him asking how to go about implementing policies developed by the government, GuyOil simply acts.
“If you reduce the price of oil then GuyOil lowers their price and their competitors are forced so follow suit. Just so easily your policy is implemented,” he explained.
