The Inter-American Develop-ment Bank (IDB) has removed information from its website about financing for the US$840 million Amaila Falls Hydropower Project, to which developers hoped it would commit about US$200 million.
However, Minister of Finance Dr. Ashni Singh when asked about the status of the project, said things were “moving ahead.” He would give no further details to this newspaper.
Up to April 2012, the IDB had listed Guyana’s Amaila Falls Hydro Project as being “in preparation” on the ‘projects’ page of its Guyana web page. However, when one now searches the page all that can be found are documents related to environmental studies and impact assessments for the Amaila Falls project.
Repeated attempts to speak to officials of the IDB, including Representative Sophie Makonnen, proved futile. E-mails to Jim McGowan, Senior Vice President of Sithe Global, have also been met with no response.
Officials of Sithe Global some months ago had stated that the IDB support was critical, while adding that it would have spelt certain doom for the project should it not be forthcoming.
In January, Sithe Global officials had reported that financial closure for the project would have come by June 2012. However, in a letter published in the press in June, they said financial closure is not possible before 2013, although they noted that their lenders remain supportive of the project.
The IDB had expressed concern over the ability of the Guyana Power and Light Company (GPL) to effectively and efficiently distribute power from the proposed Amaila Falls Hydro Project, which is believed to be among the reasons for the delay in the Bank’s approval for the venture. Another concern of the IDB is the size and scale of the project relative to the size of the country and the sophistication of the utility.
The World Bank had decided not to participate in the project—a decision which stupefied officials of Sithe Global.
The officials said further delays could see this present window of locking in a fixed price being closed and increasing the final cost of the project. As it stands, the cost of the project is US$840 million, significantly higher than originally announced due to currency movements, rising commodity prices and political risk insurance that had to be sought for the financing of the project.
CEO of Sithe Global Bruce Wrobel had stated in January that should financing not come through from the IDB or the China Development Bank (CDB), it would make things difficult for the project, since commercial banks do not typically lend to such projects.