Georgetown: Bruce Wrobel the Chief Executive Officer (CEO) of Sithe Global, the developers contracted by the Guyana Government for the Amaila Falls Hydro Electric Plant has said that he is willing to provide the Guyanese public with a copy of the contract for perusal to increase Transparency but Prime Minister Samuel Hinds says ‘not so fast.’
Hinds recently baffled reporters when he said that the Government has always been willing to and have provided information on the project, but as it relates to contract, Guyanese will have to wait until there is financial closure before the document is released.
Financial closure for the project has been elusive for several years now with the newest deadline set as June and hinges on an Inter-American Development Bank (IDB) but the agreement with the Guyana Government and Sithe Global has been inked for five years now.
Hinds when asked about making the contract document public told reporters, “that has always been our commitment and it is just a matter of time.”
The Prime Minister in seeking to explain the Government’s reluctance said that when dealing with transactions of this magnitude, “the position is, it is not agreed until everything is agreed.” He sought to make reference to the privatization of the then Guyana Electricity Corporation (GEC) saying that he had to sign some “two thousand pages (2000) and signed some 69 different documents.”
Hinds also suggested that some of the variables embedded in the transaction with Sithe Global that could presently be considered as ‘fixed’ eventually, “you may have to re-tweak”.
When reminded that the agreement between the Guyana Government and Sithe Global has been finalized for some five years now Hinds told reporters that, “we have an agreement with them yes…but these agreements,…I could tell you things that have happened since then.”
The Prime Minister said that both parties have since been adjusting to make the transaction work.
“The point I want to make is that an agreement at any stage it could vary…we may have to make adjustments next week.”
Speaking from a more general perspective, the Prime Minister said too that “equity people for these kinds of businesses start out expecting 25 percent return on their equity portion.”
He said that in the case of Sithe Global during the course of the negotiations they have lowered their expectations on the returns, “so to hand it (contract document) out at any time before the very end runs the risk of people coming back and saying you lied to us, you told us this and now it’s this.”
Hinds failed to appreciate that Sithe Global has already disclosed that it has accepted a 19 percent rate of return on its US$152M in equity that it has in the project and the Chinese Development Bank (CDB) has agreed to an eight percent return for its US$413M.
Wrobel had also disclosed that it is only the agreement with the IDB which has to be locked in for financial closure to be had.
Hinds contended that the entire transaction is akin to a1000-piece jigsaw puzzle that has to “come together.”
He said that in this process, “you keep shaping and reshaping everything…until you get the final fit…I can’t give you any specifics.”
The Prime Minister said that it would not be useful to divulge any specific position at this point in time.
In seeking to illustrate his point Hinds drew reference to the estimates of the cost of the project and said that the increases over the years have been reflective of the changes in the oil prices which escalated to more than US$100 and descended to less than US$50 and is on the rise again.
When confronted with the position that Sithe Global believes that it has a finalized enough document/contract that they are willing to make available to the Guyanese public subject to Government’s agreement, Hinds, bumbling his words suggested that there may be a difference in interpretation on how finalized is that agreement that the developers would like to make available.
Hinds suggested that the “IDB still has to come in…if the IDB doesn’t come in some things have to adjust, right…the IDB is not in yet so it couldn’t be final.”
The Prime Minister suggested that the administration could “maybe” disclose what they are aspiring for “at this moment but for us to do that, you have to have the feeling that we are really in this together.”
Hinds’ suggestion was that the administration was wary of divulging any information to the local media drawing reference to the GEC experience which he described as most interesting and frustration as it relates to media reports locally and overseas.
The Prime Minister suggested that whenever information was released locally as it related to the expectations on the part of the then Government there was a great disparity in the media reports locally and overseas.
“The media here in Guyana says this Guyanese government giving away everything to these people.”
Hinds suggested that over the course of the years that the administration has been very forthcoming with information on the Amaila Falls Hydro Electric Project much to the bewilderment of many that have been at pains to access information about the project.
“We have said a lot along the way…we have put out a lot of information along the way and we will put it out finally when it’s there.”
Wrobel had recently lamented what appeared in the past to be a project shrouded in secrecy and promised that should the other parties, specifically the Guyana Government, concur to make available the contract document, his entity would willingly do so.
“We need the others to agree, but we are willing to make the contract available.”
Wrobel said that it is in the interest of transparency that he and his team ventured to Guyana to seek to attempt to clear the air. The Guyana Government from the beginning of the project has been deafeningly silent, only venturing to the press in defence when damning information is published.
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