November 29, 2024 [Reuters]- Guyana has received preliminary approval from the U.S. Export-Import Bank for a more than $500 million loan guarantee to support a natural-gas fired power project and gas processing facility, a government official said on Thursday.

Construction of the about $2 billion gas-to-energy project is underway. A gas pipeline is installed, but the first phase of a 300-megawatt (MW) power plant has been delayed by late equipment deliveries and a contract dispute. Startup may not come before the fourth quarter of 2025, officials have said.

The ExIm Bank loan guarantee would cover purchases of U.S. supplied equipment for the onshore facilities, Guyana’s Vice President Bharrat Jagdeo said at a media briefing.

The guarantee faces a 30-day notification process before U.S. Congress, and then goes for final approval before the ExIm board, he said. The project thus far has been funded by Guyana’s Treasury.

“If the loan is made available, it will cover financing that the government of Guyana had to make during the period since the project started,” Jagdeo said.

The gas-to-energy project includes a natural gas pipeline that has been built by an Exxon Mobil-led consortium responsible for the country’s oil production, a gas processing facility and 300-megawatt natural-gas fired power plant. The project could reduce power supply costs by 50% when it is fully operating, officials have said.

A second phase of the project would include additional power generation and help develop other industries, including a proposed fertilizer plant, according to the tender published by the office of the prime minister.

A startup date has not been finalized. The government and power plant builder are in contract arbitration over the cost and completion deadline. The plant originally was expected to be completed this year.

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