The Inter-American Development Bank granted another loan to Guyana for work to be done on the Energy Sector.
The loan of $21M is meant to finance the Energy Matrix Diversification and Institutional Strengthening of the Department of Energy project.
Guyana Power and Light (GPL) and the Guyana Energy Agency (GEA) are the executing agencies of the programme.
One phase of the project is to diversify Guyana’s energy systems using cleaner, more sustainable energy solutions to diversify the energy matrix, in an attempt to mitigate climate change. Solar technology is to be invested in three towns, Bartica, Lethem and Mahdia. Of the total loan, US$8.6M is set aside for this phase.
The IDB also means to invest in “reinforcement of transmission infrastructure” to make the Demerara-Berbice Interconnected System (DBIS) more reliable, specifically the Kingston-Sophia transmission section.
US$9.95M is the cost estimate for this phase. However, the IDB has only lent US$6M for that project. GPL is expected to foot the remaining US$3.95M, the cost of some additional resources.
The third component is to strengthen the institutional capacity of the Department of Energy to develop a regulatory framework for the governance of the Oil & Gas sector. Particularly, it will finance capacity building initiatives and a best-practice organizational structure, including high level training and coaching of DoE staff. That is slated to cost $21.16M.
The government is currently working to put the necessary framework in place in time for first oil. It has taken several loans from regional banks to finance those endeavors.
Guyana was approved for a loan of US$11.6M last December. That loan was meant for, among other things, paying for drafting a model contract for future Production Sharing Agreements (PSAs).
The World Bank also, last month, approved a US$20 million loan for a Guyana Petroleum Resources Governance and Management project to “strengthen institutions, laws and regulations to promote good governance and a prudent management of Guyana’s oil and gas sector…(update) existing laws and regulations and introduce strong checks and balances to mitigate environmental and social impacts”.
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