The planned onshore gas project will play perhaps the most important role in helping Guyana Power and Light significantly reduce its heavy oil import bill which is currently used for power generation. Just last week, the power company said rising oil prices, due to the Russian-Ukrainian war, were putting severe pressure on its budget.
GPL said its landed cost of fuel is around US$140 per barrel and has quadrupled since 2016, when the price of fuel was around US$30 per barrel. LPG currently uses around 3,700 barrels of fuel per day for power generation to meet daily demand, at a cost of around GY$111.5 million. It said its monthly operating expenses have now risen to about GY$4.5 billion from monthly electricity sales of about GY$3 billion, making its operations unsustainable.
Together with the pipeline and gas processing facilities in Wales, this will remove LPG’s reliance on heavy oil while reducing the cost of electricity for Guyanese by 50% or more. But the benefits go beyond a cheaper lighting bill. Gas is cleaner than heavy oil. Using this cleaner fuel to generate electricity will reduce Guyana’s carbon footprint and put the country on the right path to renewable energy. If there was ever a light at the end of the tunnel to our problems of power cuts and high lighting bills in Guyana, it is the gas ashore project.