World Bank declined to participate in Amaila Hydro Project

Without the Amaila Falls Hydro Electric Plant, Government is now saying that electricity charges will have to be increased by as much as 30 per cent.
This was the disclosure by Prime Minister Samuel Hinds, who along with Winston Brassington, yesterday appeared in a televised interview and said too that in order to be ready to receive power from the Hydro Project, Guyana Power and Light (GPL) would need an additional US$90M.
Both Brassington and Prime Minister Hinds also defended the structure of the project, which sees financing costs of US$320M, and describes the deal “as the best one.”
Former Auditor General, Anand Goolsarran, among other critics had lambasted government over the financing structure for the Amaila Falls Hydro Electric Project.
According to Prime Minister Hinds, “those gentlemen cannot put a better arrangement on the table.”
“We have a project that is about the best that could be obtained in the world at present time.”
As is currently structured, the Amaila Falls Hydro Electric project is being built with 70 per cent of the price tag coming in the form of loans.
The remaining 30 per cent of the price tag for the Amaila Hydro Project comes through direct investment.
Brassington, who played a key role in negotiating the project, said that had it been reversed and the investment share in the project been 70 per cent and the debt 30 per cent, then this would have in fact made the project even more expensive.
“In project financing, the structure we have is regular,” according to Brassington.
Former Auditor General, Goolsarran, had suggested that the Government reduce the levels of debt to project and increase the investment equity.
The televised interview was sponsored by the National Industrial and Commercial Investments Limited (NICIL) and moderated by Grantley Waldron.
He sought to find out from Brassington also, why it is that the World Bank was not a part of the project to which the NICIL boss declined an answer, saying he can’t share the reason.
He said that Sithe Global the project developer is a private company and it was that company that made the overture to the World Bank when it declined to participate in the Amaila Falls Hydro Electric Project.
Pressed to reveal the reasons behind the non participation of the World Bank, Brassington responded by saying, “if it was public information why didn’t the World Bank release it.”
In defending the US858M price tag for the project, Brassington maintained it is not too high and spoke of international competitive tendering in 2009 among other aspects.
Turning their attention to the matter of GPL, Prime Minister Hinds said that projections for GPL reduced tariff is also based on the premise that the power company will reduce its technical and commercial losses by seven per cent, by the time the hydro project comes online in 2017