Aug 29, 2013 News
…addition US$57.2 unearthed in project document
The Guyana Government has committed US$157.2 to the Amaila Falls Hydro Electric Project, US$57.2M more than the US$100M that it has been maintaining all along.
This was contained in the ‘Confidential Project Document’ leaked to this publication. This means that the revised price tag is now in excess of US$915M.
According to the project document for the Hydro Electric Plant, in 2014 and 2015 the Government has under its ‘financial commitment’ to the project, committed US$21M to be paid each year from its Fund for Special Operations (FSO).
The Fund for Special Operations has been set up by the Inter American Development Bank (IDB) and extended to several countries, including Guyana, which sees the bank making concessionary loans.
Government has been contending that Guyana’s taxpayers will pay about US$100M in equity.
This money, it said, consists of approximately US$20M, which is being spent on the access road to Amaila and US$80M which is being invested from the Guyana REDD+ Investment Fund (GRIF).
The Confidential Project Document however has revealed that for Guyana’s financial commitments, US$11.4M was spent prior to 2013 on the Amaila Falls Access Road.
It states that in 2013 some US$21.8M was committed to the road and another $0.5M to be spent each year between 2014 and 2017.
This would bring the total cost earmarked for the completion of the Access Road to US$35.2M.
The road project was originally slated to be US$15.4M, less than half the cost that it stands now.
During the recently held National Stakeholders Consultation on the Amaila Falls Hydro Electric Project, it was restated that Guyana is only putting in US$100M.
The remainder of the money for the project was said to be coming from Sithe Global, who was said to be investing US$157.4, China Exim Bank US$500.7M and the IDB which was applied to for the remaining US$100M.
Amaila Falls Hydro Inc., which was set up to build the plant, is majority owned by Sithe Global, given that it was investing more than Guyana.
Additionally also, under the arrangement with Sithe Global, all debt currently owed by the Guyana Power and Light will have to take the back burner, as the power company would have to make its priority payments to ‘Senior Amaila Debt.’
This is according to the agreement signed to by Government as requested by Sithe Global.
The Company had also demanded that the Guyana Government ensures that GPL remains a monopoly for the sale of electricity and a majority government controlled enterprise.
Meanwhile, as it relates to the US$150B amount that Sithe Global had requested for Government to guarantee, should GPL make shortfalls, this publication has been reliably informed that this was related to the Value of the Debt, the Value of Interest During Construction as well as to buffer any financial adjustments that would have been made before financial closure is secured.
The previous guarantee limit stood at $1B but when the Parliament, through a majority vote, only approved a US$50B limit, Sithe Global walked from the project.
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