APNU+AFC Member of Parliament and Alliance for Change (AFC) executive David Patterson has challenged Vice President Bharrat Jagdeo’s statement that the United States Export-Import (EXIM) Bank approved US$509 million of the US$640 million loan requested for Guyana’s Gas-to-Energy (GtE) project.
Patterson said that contrary to Jagdeo’s remarks, the loan has not yet been approved and is still under review.
At an AFC press conference yesterday, Patterson cited information from an unnamed source who has been in contact with the EXIM Bank for over a year. According to his source, “No approval was given by the EXIM Bank at their last meeting in November.” Patterson further noted that the EXIM Bank will next meet on January 9, 2025 and if the loan comes up for discussion, only then can a final decision be made after which it is then sent to Congress for approval.
He stated that “Following any decision by the EXIM Bank, the loan application must be sent to the United States Congress for a 30-day review. Congress, (is) currently in its “lame-duck” session, between the transition of administrations. When Congress is fully functional it is normally tied up in matters required by the new administration and it is not anticipated that this matter can reach discussions or approval before March 2024”.
Patterson added that even if Congress approves the application, it must be returned to the EXIM Bank’s board for final approval, after which legal and procurement processes would take six to nine months before funds could be disbursed.
Vice President Jagdeo had announced on Thursday at his press conference that the EXIM Bank’s board had approved the US$509 million loan and submitted it to Congress for a 30-day notification. He stated, “The loan has been approved by the Board of EXIM Bank and it has been sent to the Congress for 30-day notification.” However, he acknowledged that the loan would need to return to the board for final approval after Congress’ review.
The Vice President also said that the loan amount was reduced from US$640 million to US$509 million because it would only cover exports from the United States. He assured that retroactive financing would reimburse the government for costs already incurred on the project.
The Government of Guyana has already state-financed approximately US$400 million of the US$761 million project and had said back in August that they are prepared to fund the remainder if the loan sought from the EXIM Bank is not approved.
At the same press conference in August, Jagdeo also emphasized that while the loan was delayed, the project remains on track for completion in 2024. He also highlighted the country’s financial strength, stating that being able to fund the project without borrowing demonstrates Guyana’s growing economic capability.
The GtE project is divided into three components – 1) Pipeline, 2) Power/NGL (natural gas liquids) Plant, and 3) Transmission Line/Substations.
The pipeline component includes a 250-kilometre, 12-inch pipeline from two Floating Production, Storage and Offloading platforms (FPSOs).
The power/NGL component is the 300 MW Combined Cycle and NGL Plant, while the third component will have 85 kilometres of 69 KV and 230 KV transmission lines, 3 new substations, and upgrades to two other sub-stations.
