- Prime Minister Phillips saysproject will be the backbone of a stronger economy
GEORGETOWN, Guyana, (DPI) – Senior finance minister, Dr Ashni Singh recently joined prime minister Brigadier Mark Phillips and United States EXIM Bank’s president and chair Reta Jo Lewis on a visit to Guyana’s historic and transformative Gas to Energy project.
While on-site, Dr Singh and the US EXIM Bank’s president officially signed the Term Sheet for the US$527 million loan which was approved on December 26, 2024, to support the project. The signing took place at the project site at Wales on the West Bank of Demerara and was overseen by prime minister Brigadier Mark Phillips in the presence of US ambassador to Guyana Nicole D. Theriot, other Guyana government officials including minister of natural resources Vickram Bharrat and US EXIM Bank officials who are in the country accompanying the US EXIM Bank chair on a high-level visit.
United States (EXIM) approves $527M for Guyanese Energy Project
Prime Minister Mark Phillips during his remarks at the signing indicated that today was a turning point in Guyana’s history, noting that the project will be the backbone of a stronger economy that is prepared to compete on the global stage.
“This is indeed a most transformative project, and it is the largest project in terms of size and financing that is embarked upon by the Government of Guyana in the history of Guyana. This is the moment that speaks to the power of vision, the strength of partnership and the enormous possibilities which can arise with shared purpose,” the prime minister added. He emphasized further that the signing of the agreement between the government of Guyana and the US EXIM Bank is a declaration of trust in Guyana’s potential and a commitment to shaping Guyana’s future.
Prior to signing the agreement, Dr Singh said that the US EXIM Bank’s financing of the Gas to Energy project bears testimony to the enduring strength of the US/Guyana relationship. He alluded further to the transformative nature of the project and the special relationship Guyana shares with the US as he noted that the historic transaction paves the way for many more and is a good example of what can be achieved through partnerships such as that between the US and Guyana.
The finance minister recalled his first meeting with the US EXIM Bank chair in April 2022 as he noted that it was only months after that government and the bank signed a Memorandum of Understanding (MOU) under which EXIM agreed to make available an aggregate exposure of 2 billion US dollars to Guyana.
“Notwithstanding that, during the course of this journey, it felt sometimes that we were not getting it as quickly as we wanted to, but the reality is that moving from zero to half a billion in two and a half years really is a remarkable achievement,” Dr Singh added, on the basis of which he thanked all parties concerned in bringing the project to the point it had reached.
Dr Singh also encouraged the local private sector businesses to avail themselves of the various tools, instruments and products that are offered by the US EXIM bank while restating that Guyana is open for business and further indicating that Guyana would like to see more US companies doing business in Guyana and with Guyanese businesses.
Delivering remarks during the signing, US EXIM Bank’s president and chair Reta Jo Lewis said Guyana’s economy has continued to grow and prosper and today marks another important milestone on this journey. She also highlighted that the EXIM Bank board voted unanimously to approve the over half-a billion-dollar financing for the transformative Gas to Energy project which she said is not only a game-changer for just Guyana and the United States, but for the people, businesses and shared aspirations that unite the two nations. She added that ‘together we are taking bold steps to strengthen energy, security, enhance environmental sustainability and unlock economic opportunity’.
In October last, president Irfaan Ali, during his address to the National Assembly pointed out that in keeping with his government’s commitment to reduce the cost of electricity, government would be reducing by 50 percent the cost of electricity for every consumer in Guyana.
“This investment will see savings in excess of US$250 million. This is an injection of US$250 million by the government of Guyana that will positively impact disposable income by the reduction in the cost of electricity. That is more than $50 billion back in the pockets of the Guyanese people”, he had explained.
The head of state had explained further that the Wales development hub is an integral part in the energy equation and consumption as it will create opportunities for industry, agro-processing, and manufacturing, open up new opportunities for jobs, create new industries and expand the economic base of the country.
“Our gas strategy is based on providing electricity at a low price for onshore development while seeking to monetise gas for export in the medium term,” the president told the National Assembly.
In the country’s 2024 budget, $80 billion was allocated to advance the project and its associated infrastructure, including transmission and distribution upgrades to offtake the power while construction of the power plant.
The minister had, over the years, beginning in 2022, participated in various high-level engagements with US EXIM Bank officials to discuss vital support for the ambitious GTE project in order to further advance it so it would play a pivotal role in Guyana’s economic future.
The project will see a 200-kilometre pipeline bringing gas from the Liza Destiny and Liza Unity Floating Production fields onshore. The pipeline will continue for approximately 25 kilometres to the Natural Gas Liquid (NGL) plant to be constructed in Wales. The complete project will result in several benefits to Guyanese, including job creation, improved electricity access, foreign investment, and energy security.
In 2022, Guyana and the US EXIM Bank signed a historic US$2 billion Memorandum of Understanding under which the parties agreed to explore options for utilizing the bank’s standard instruments including direct loans and medium- and long-term guarantees and for the financing of US exports to Guyana for government projects. The MOU represented an important milestone in US-Guyana relations laying the foundation for Guyana to access financing and facilities from the EXIM bank for the first time and provided for interventions at a scale likely to have a lasting developmental impact.
