Guyana – Brazil Hydro… Government not negotiating in the best interest of us – Harmon

May 11, 2014, By KNews. Filed Under News, Source

The Opposition must examine this deal the PPP has signed with Brazil to develop hydropower near the Guyana-Brazil border.

This is the contention of letter writer M. Maxwell in a letter to Kaieteur News captioned “Did the PPP sign a deal similar to the Brazil-Paraguay Itaipu hydro rip-off?”

Maxwell was making reference to the US$45 Million pre-feasibility study between the Guyana Government and a Brazilian consortium to determine the potential of hydropower in the Upper and Middle Mazaruni. This was announced at a Prime Ministerial press conference last March.

Minister Carolyn Rodrigues-Birkett who was present at the press briefing said that in 2009 at the commissioning ceremony of the Takutu Bridge, both countries saw hydropower as an important part of the agenda.

APNU’s Executive Member Joseph Harmon

Discussions on hydropower commenced the next month. A Memorandum of Understanding (MOU) was signed between Guyana and Electro Braz, the agency to look at the Mazaruni/ Potaro Basin, she said.

“We were approached by a consortium of Brazilian companies and after months of negotiations Prime Minister (Samuel) Hinds signed an MOU in October 2011. Thereafter, we decided that whichever company we used must come under the Guyana/Brazil Cooperation,” the Minister had outlined.

Maxwell said that the PPP “must publicly produce the details of this deal to the nation.”

He drew a parallel with the Guyana-Brazil prefeasibility study and that of the agreement between Brazil- Paraguay in the development of a hydroelectric dam (Itaipu) located at the Parana River on the border section between the two countries.

According to Maxwell, “The world’s biggest hydropower dam is shared by Brazil and Paraguay. There is a joint entity that owns it but in reality, Brazil controls and dominates it. Paraguay must sell its entire half of the power generated by this hydro project to Brazil, and to no one else.
“When this type of arrangement exists, then the buyer dominates the seller.”

“Paraguay is forced to sell its hydropower at rock bottom prices and dirt cheap to Brazil or have that power go to waste. Sometimes, it has to sell below production cost, which is selling at a loss.

“Brazil gets the cheap energy it wants to accelerate faster to economic liberation and greatness while Paraguay faces spiraling debt to fund this debacle. The Paraguayan president, Fernando Lugo, had to threaten taking Brazil to the International Court of Justice to force Brazil to offer increased compensation under the deal.”

Maxwell is of the view that the PPP Government with its poor track record “proven by their near-disastrous saddling of this country with US$1 billion in debt over a dried-up Amaila Falls hydro project or their enslavement of this country to a hostile neighbour in Venezuela through Petrocaribe, will make the same atrocious errors they have consistently made and will continue to make.

“They will sell this country short.”

He said that “the PPP has shown a frightening propensity to sell this country down the river to the highest bidder without careful analysis of the risks of these politically expedient endeavours.”

“Guyanese need to know the details of these deals on hydro development with Brazil, for we will not become another Itaipu where the power we generate is made worthless by the recklessness of those sitting in the seat of government” said Maxwell.

A Partnership for National Unity (APNU) Executive Member and shadow Minister of Public Works and Transportation Joseph Harmon said that the Opposition has been insisting that they be part of the agreements and studies that Guyana enters into bilaterally.  “We are not the government but at least we should be in those negotiations so that we can bring another perspective to it.”

“We have entered into some agreements with Suriname for the building of a bridge across the Corentyne River. The government does not see it fit to lay that agreement in Parliament so that we can make an input in it but has gone to allocate monies in the Budget for construction of certain aspects of the bridge.”

Harmon said that Maxwell had given a good example as to what can happen when you don’t have your agreements properly negotiated upfront and the country tends to lose at the end of the day. “We should not disregard that advice from those people who are observing and putting forward sensible recommendations” he said.

Prime Minister Samuel Hinds had said in the press briefing that quite a lot of power would be sold to Brazil. He explained that there will be money paid to Guyana for producing the electricity utilizing waterfalls.

At a later stage there will be financial engineers working through questions as to who will earn revenue sold to the countries.