While it supports the gas to energy project, the opposition APNU+AFC on Monday said that it still lacks transparency and costs have ballooned to such an extent that a 50% cut in tariffs is unlikely.
In a statement it noted that the project was initiated by the APNU+AFC government as it had recognized the need for additional and cheaper electricity.
It charged that when the PPP/C government came to power, it changed the location of the project, did no updated feasibility study for the project at the new location, provided no cost benefit analysis and no concrete information on the cost of electricity to the consumer.
“Given these circumstances, it is becoming clearer and clearer that this project is unlikely to reduce the cost of electricity by 50%, without a substantial subsidy. This would represent yet another PPP failure to deliver on its promises. The government has presided over a striking escalation of costs, with the pipeline originally only expected to cost $304 million USD, inclusive of facilities to enable the natural gas to be used by a gas to electricity plant and other suitable generators operated by GPL.
“This cost has ballooned to $1 billion USD, impacting the final tariff that consumers will have to pay for electricity. Because we would have managed these costs more thoughtfully, we would have been able to deliver much cheaper electricity to consumers than the PPP. Not only would we have maintained the location identified by the Energy Narrative feasibility study we commissioned, saving at least $100 million USD, we would have kept a closer eye on the growth of all other related costs”, the statement said.
The government has argued strongly that there will be a 50% cut in tariffs as a result of the project.
The opposition said that it is also concerned about the lack of accountability and high level of secrecy that surround the project. It cited the lack of information such as the interest rates the government will face for various components of this project.
“Similarly, Guyanese need to know whether appropriate insurance is in place to ensure the country is not exposed to large cleanup costs in the event of any pipeline rupture. All agreements relating to this pipeline must be made public immediately. This project represents by far the largest public investment our country has ever undertaken and thus it is doubly important that it should be managed in the most responsible way possible”, the opposition stated.
The opposition said that the government can release all the relevant documents tomorrow if it chooses to abide by established principles of transparency and accountability.
“Finally, it is important that we remind Guyanese that the government wasted millions and millions of USD of taxpayer dollars on projects such as the Skeldon cane factory and the fibre optic cable project, which were characterized by similar mismanagement and the lack of transparency and accountability. “Just as the Gas to Energy project has gone from several hundred million USD to a total cost of $2 billion, Skeldon went from over $100 million USD to over $200 million. This country cannot afford another failed project, like Skeldon. We see no reason why accepted principles of good governance must be sacrificed in the execution of the Gas to Energy Project”, the opposition said.
