@Former Member posted:Amaila hydro a ‘kick-back’ project for the PPP cronies – Opposition Leader
Jun 08, 2022 -- Source -- Kaieteur News Online -- https://www.kaieteurnewsonline...s-opposition-leader/
Kaieteur News – Citing the cheaper options currently available for electricity generation, Leader of the Opposition, Mr. Aubrey Norton is of the firm belief that the 165 Megawatts Amaila Falls Hydropower project will serve solely as an avenue for the People’s Progressive Party (PPP) to benefit.
Norton gave this view yesterday in response to a question posed by Kaieteur News during the People’s National Congress Reform (PNC/R) weekly press conference.
The Leader explained that the former A Partnership for National Unity + Alliance For Change (APNU+AFC) government had discontinued the project on the grounds that it was not well conceived and could therefore be no use to the people of Guyana.
Leader of the Opposition, Aubrey Norton addressing members of the media during his weekly press conference.
Only last week, Vice President Bharrat Jagdeo told members of the press that the Chinese Contractor – China Railway First Group – had been unable to secure the finances. According to the Vice President, the contractor had as late as April 22, last, written to the government “saying that they are having a hard time doing the BOOT (Build, Own, Operate Transfer) contract and they want to shift to an EPC (Engineer, Procure, Construct) plus finance” option instead.
According to Norton, however, while the details of the arrangement remain sketchy at the moment, the Coalition believes that the entire project remains “misconceived, ill conceived” and a complete “waste of taxpayers’ money.”
Norton was keen to note that the APNU+AFC while in government understood the importance of solar power generation, and still believe that this method of electricity generation should be utilised, as this option remains most feasible.
“The APNU+AFC while in government, and until now, and I think well articulated by the then Minister David Patterson, believes that there should be an approach that allows us to use all options including solar based on the specifics of the area. For instance, in some areas wind might be a good option because of the level of wind. Some areas solar is a good option or generally in all areas and so we do believe solar has potential, it is cheaper and it should be utilised,” the Leader of the Opposition urged.
On the other hand, he told this publication that the present administration is not concerned about a viable option to generate electricity, but rather an avenue to siphon off funds for its cronies.
He argued, “You have a government that is interested in getting its cronies rich off of oil and gas and will not look at the options and arrive at the best for Guyana. What they do is choose that which will put more monies in their cronies pocket and so their position is understandable but unacceptable. We believe that there are many areas that solar, wind and other forms of energy, they are relevant and therefore they should be utilized.”
Jagdeo in announcing the changes of the Amaila Falls deal with the Chinese noted that under an EPC contract, it would mean that the government would have to secure the finances for the project and that they would be used as the EPC contractor.
As such, Jagdeo disclosed that in light of the developments, government may very well have to retender the project.
“We have been in discussion with the company since November last year, the discussions, the negotiations are very difficult,” according to Jagdeo, who indicated that “in the negotiations, we are still trying to get them to meet the commitment that they bid.”
He told members of the media “…in the last six months or so we have been struggling to reach agreement and so we are now going to have to give a deadline to cancel; if they can’t proceed as the original model so we may have a set back there on that.”
Asked to provide further clarity on the contractor’s position during the ongoing negotiations, Jagdeo divulged that it was not a case of the Chinese not being in favour of a BOOT arrangement but rather “they simply can’t raise the financing, because of that.”
Under the BOOT, arrangement, he said, it “meant they had to build it, own it and supply us with power at a particular price and then 20 years after transfer it to the government for free, because that is what they bid on.”
In such an arrangement, Jagdeo said, “…we would not have any debt, there would be no debt associated so that model they are saying they can’t pursue.”
It should be noted that under the most recent iteration of the project as presented, Guyana was to stand the majority of the major risks involved in the project.
These include those related to political force majeure, payments risks in the event that electricity sold is not sufficient to meet the Power Purchase Agreement demands, and hydrology where Guyana stands the risk associated with the likelihood of there being insufficient water supply, meaning if the Amaila Falls runs dry, among other risks.
Senior Minister in the Office of the President, with responsibility for Finance, Dr. Ashni Singh in January last had announced that the Chinese contractor, who was granted approval to construct the Amaila Falls Hydropower Project, would commence operations on the mega venture this year.
The Finance Minister had explained, “The project will be developed under a build-own operate-transfer (BOOT) arrangement within which the Guyana Power and Light Incorporated (GPL) will purchase power from the operator under a Power Purchase Agreement (PPA). We anticipate that construction will begin in 2022 and be completed by 2027. Once operationalised, the facility will reduce the cost of energy significantly for both businesses and households.”
Bring in vice to interview the players.