Feb 13, 2023 News
By Kiana Wilburg
Kaieteur News – In October last year, Grand Canal Industrial Estates (GCIE), which is 100% owned by CGX Energy Inc., announced it had inked a contract with Gaico Construction and General Services Inc. (Gaico) is to begin in-river construction of its Deep-Water Port. That project is located north of and adjacent to Crab Island on the eastern bank of the Berbice river.
The company indicated then that it had engaged in a re-design of its in-river trestle and wharf to seek efficiencies as the price of steel rose steeply in 2022, resulting in a modification of its original schedule of construction.
Kaieteur News visited the facility on Sunday, February 12th, 2023 to observe the progress of the work completed and the in-river construction. Michael Stockinger, CGX’s Vice President of Operations, shared that all of the required pre-stressed concrete piles have now been produced by a local contractor, tested independently and are now being installed.
Stockinger, a Civil Engineer with over 42 years of experience as a driller for companies like Kerr McGee, Murphy, Conoco Phillips and Anadarko, was on hand with other officials of the company, as Gaico commenced the installation of piles and dredging, as a 160 feet access trestle is being built from the shoreline into the Berbice river, in a East-West direction. Stockinger shared when the nearly 40 feet wide trestle is completed, the plan is to then construct a wharf platform perpendicular to the trestle, in a North-South direction. The original design called for the use of steel piles, but working with consultants, Aqua Y Terra, Case Engineering Inc. and Gaico, the in-river structures were redesigned to utilize pre-stressed reinforced concrete piles. The result of this approach is significant savings to the company’s capital expenditures. Engineers also suggest that the concrete pilings are likely to be more resistant to salt-water corrosion.
Significant Investment in Berbice
Kaieteur News understands that the company has spent some US$22 Million already on the facility and with the trestle now being built, the CGX facility is one of the largest private sector investments in the ancient county. The Government of Guyana has expressed concern from time to time regarding the pace of the project.
It was evident, however, that there has been a considerable amount of development at the site – starting from the access to the Corentyne highway and the Company’s 16-acre Logistics Yard located at Bramfield/Palmyra along the Corentyne Highway. It was also evident that CGX has developed symbiotic relationships with residents in the area, in particular Seawell Village, where it has constructed concrete drains, concrete driveways and paved the roadway for the benefit of the residents. The company has also installed solar street lights along the 3.2 km access road to the site, and along the perimeter of the site.
Kaieteur News understands that the Company is also about to embark on the collection of garbage generated by residents of Seawell Village, in partnership with the area NDC, to help promote responsible disposal of garbage. But the collaboration between Seawell Village and GCIE does not stop there.
The company constructed, for example, a protected pedestrian walkway on a recently constructed concrete bridge, to facilitate the safe passage of residents when the bridge is being used by vehicular traffic. Kaieteur News understands that GCIE cleared 20 acres of Mangroves in 2011, under permit from the Environmental Protection Agency (EPA), Guyana Forestry Commission and all other regulatory agencies. The company has since then been monitoring the site and providing annual reports to the EPA which detail the state of the physical, biological and ecological factors in and surrounding the site. Of the 30 acres which GCIE controls, 10 acres of standing mangroves have been set aside by the company as a living laboratory and protected habitat. GCIE also works closely with the Chambers of Commerce in Berbice, the Tain Campus of the University of Guyana and the several Technical Institutes in the county.
Long Term Contracts & Importation of Aggregates
Professor Suresh Narine, CGX’s Executive Co-Chairman, shared that the company is very interested in capitalizing on the Government of Guyana’s announcement that it intends to begin importing aggregates from Canada. Dr. Narine is confident that the rate of economic growth in the country currently and projected, no doubt creates an immense need for additional, non-congested ports which are not located close to residential areas, such as the Berbice Port.
However, he explained that for private sector companies, investment in large infrastructure projects must also be supported in the near term by contracts and existing business. With the current oil and gas activities currently concentrated in the Demerara River, Narine shared that GCIE has been focused on defining near-term contracts in agriculture, consumer cargo, emerging aggregate imports and other opportunities. Narine shared that securing contracts is of great importance in order to continue the company’s progress and significant investments in Berbice.
With this goal in mind, he shared that Vice President, Dr. Bharrat Jagdeo has been encouraging the Company to seek partnerships with Government and Canadian aggregate suppliers to address the Country’s demand for construction aggregates. Narine indicated that GCIE expects that as the partners on the Stabroek block move into additional production developments and explorers such as CGX and its JV Partner, Frontera, progress their exploration phases into appraisal, the oil and gas port demand could mean significant contracts.
In January, the Government had announced that it is working with the Canadian High Commission in Guyana to seek suppliers of aggregates for its massive infrastructure works in the country, including the building of a four-lane highway on the Corentyne Coast. The Government has indicated that it estimates needing up to 6 million tons of aggregates per year over several years. Narine explained that the GCIE facility could be ready to take advantage of such imports of aggregates as soon as the trestle is completed. The company has already completed all sea defences along 1300 feet of river frontage of the 30 acre facility and has constructed a 10-acre laydown yard built to sustain 5 tons per square metre. As such, the facility could facilitate the delivery and storage of aggregates from the time the trestle is built into the river as it will allow vessels delivering aggregates to be moored. The company also articulated the possibility to take advantage of its 16-acre Logistics Yard along the current Corentyne Highway as a decanting storage facility, to allow facility access to imported aggregates for construction. Recently, the Irfaan Ali-led PPP administration announced several infrastructure projects in Berbice, including a stadium, airport, new four lane highway, Corentyne River Bridge and several hotels. This and on-going work in the ancient county have created an immense demand for construction aggregates, which cannot be met by the country’s operating quarries.
Congestion, Communities and Competitive Advantages
The development of new industries and sectors, such as the oil and gas sector in Guyana, inevitably creates growing pains. Often, communities, environmental concerns and perturbation of the state of affairs results in pressure points. There has been, lately, several matters rising to the fore such as the use of hazardous materials in densely populated areas, traffic congestion at port sites, displacement of consumer port business due to the growing demand in the oil sector, and other concerns regarding the zoning of areas which is necessary to allow for the safe and healthy co-existence of the population with the rapidly expanding industry.
Port Georgetown, the historical main port in Guyana, grew in a haphazard, unplanned manner as commerce in the country grew. Even before the oil and gas industry, it was a congested port, with almost no decanting space as it is located in the city. This congestion has become acute with the massive increase of activities from the oil sector, with significant delays being felt in import/export of agriculture, consumer goods, timber, sugar and other products.
CGX and Government have both pointed to the Berbice Port as a solution, at a site where there is no congestion, which is being purpose-built and which is sufficiently far away from built up areas and human population, without hampering access to labour and attendant services.
Additionally, the Berbice River has the deepest natural draft of all the three main rivers in the country, minimizing the amount of dredging that has to be done to achieve similar depths in the Demerara or Essequibo. Another advantage of the location is the proximity to Suriname and the opportunity to stage oil and gas exploration and production activities occurring in that country, as well as proximity to the Northern States of Amazonia and Roraima in Brazil and the opportunity to stage import/export of agricultural and consumer goods to these landlocked states. The Berbice port provides an advantage in that it is only approximately half the distance to the Panama Canal compared to current routes through the river port of Manaus.
The company articulates the opportunities that these attributes bring, but also is clearly focused on securing current contracts for the facility so as to continue to sustain its progress. In this regard, it indicated that it intends to work collaboratively with the Government to unlock these near-term opportunities.
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