By Mark DaCosta- The Gas-to-Energy project is now facing its third major delay, with completion pushed back to 2026, the government stated. The opposition People’s National Congress Reform (PNCR) has strongly criticised the People’s Progressive Party (PPP) Government for what it describes as severe mismanagement.
In a press statement issued on February 28, 2025, the PNCR highlighted the project’s continued setbacks, arguing that the PPP government has failed to ensure proper oversight and cost control. Originally conceptualised under the APNU+AFC Coalition government, the project was intended to reduce electricity costs and improve energy reliability by harnessing Guyana’s natural gas resources. However, mounting delays, increasing costs, and legal disputes under the PPP administration, have cast doubt on its viability.
The Gas-to-Energy project, based in Wales, West Bank Demerara, was initially budgeted at approximately US$900 million. However, with the latest delays and unforeseen expenses, the total cost has surged to nearly US$2 billion. The project involves laying a 225-kilometre pipeline from the offshore Stabroek Block to the Wales Development Zone, where the natural gas will be processed and converted into electricity. The goal is to significantly cut Guyana’s electricity costs.
Despite these promising objectives, mismanagement by the PPP regime has plagued the project from the outset. Vice President Bharrat Jagdeo recently admitted that the government is still assessing the financial impact of the latest delay. However, he failed to provide any estimates for the costs incurred from previous setbacks. This lack of transparency has drawn sharp criticism from the PNCR, which insists that the government must disclose all expenses related to the project.
“The project is already two to three times its initial cost and will significantly impact the PNCR/APNU government’s first budget in 2026,” the opposition stated. With costs continuing to rise, the burden on taxpayers is increasing, raising concerns about the government’s financial planning and accountability.
Further complicating the situation are legal disputes surrounding the project. Two contractors have filed arbitration suits against the PPP government, demanding compensation for cost overruns amounting to roughly US$100 million. These legal challenges pose additional financial risks, not only in terms of settlement amounts but also in the ongoing legal fees associated with arbitration proceedings, the PNCR pointed out.
The PNCR has blamed the PPP government for these legal complications, arguing that poor planning and inadequate site assessments have contributed to the project’s delays and subsequent disputes. If the project had been carefully monitored and proper geological studies conducted before construction began, many of these issues could have been avoided.
This situation bears troubling similarities to the Skeldon Sugar Factory disaster, where billions were spent on a facility that ultimately failed to deliver on its promises. The PNCR has warned that without better management, the Gas-to-Energy project could suffer the same fate.
Despite the ongoing difficulties, the PPP government has recently announced plans for a second Gas-to-Energy project at the same Wales location. Unlike the current state-funded initiative, the new project is expected to be privately financed. However, the PNCR has raised concerns about potential conflicts of interest, lack of transparency, and the financial burden of necessary infrastructure improvements.
One major concern is the cost of soil remediation at the site. Given the land’s unstable composition, significant groundwork is required before any new facilities can be built. The PNCR insists that these costs must be clearly calculated and accounted for in any agreement with private investors.
Additionally, the opposition is calling for stricter due diligence on all companies bidding for the project. Any consortium formed specifically for this venture must disclose its beneficial owners to prevent nepotism and cronyism. The PNCR is also demanding that only firms with proven experience in constructing and operating power plants be considered, to avoid the risks associated with unqualified contractors.
“The entire process must be transparent and must duly respect the people’s right to know,” the PNCR emphasised. With billions of taxpayers’ dollars at stake, public oversight is crucial to ensuring that the project does not become another financial disaster.
On the face of it, for ordinary Guyanese, the continued delays and cost overruns translate to prolonged suffering under high electricity prices and unreliable service. The PPP had previously promised that the Gas-to-Energy project would cut electricity costs by half this year. However, with the project now pushed back to 2026, the only way to deliver on that promise would be through direct government subsidies.
The PNCR has warned that Guyanese should brace for further depletion of the Natural Resource Fund (NRF) and an emergency supplementary budget running into tens of billions of dollars to subsidise electricity. This would place further strain on public finances, reducing available funds for healthcare, education, and other essential services.
As the General and Regional elections approach, the Opposition has made it clear that, should it return to government, it will have to take charge of the project, assess its viability, and ensure its proper execution. The PNCR is positioning itself as the party that will bring much-needed accountability and oversight to Guyana’s energy sector.
The Gas-to-Energy project was supposed to be a game-changer for Guyana, but years of mismanagement, legal battles, and skyrocketing costs have turned it into a source of national frustration. While the government insists that the project will eventually deliver on its promises, the mounting evidence of financial mismanagement raises serious concerns about its future.
