Oil Sector

 

 Governance and Transparency

A deep dive into the procurement practices of Guyana’s Gas-to-Energy project reveals questionable costs and a stark contrast with the nation’s developmental needs.

By Guyana Business Journal Editorial · April 7, 2026

The structural integrity of a nation’s development is tested not by its revenue, but by its procurement. In December 2023, Steven Bodzin of REDD Intelligence published a documented account of the two companies Guyana had hired to build its US$759 million Gas-to-Energy (GtE) project [1]. He found that both members of the Lindsayca-CH4 consortium had deep roots in Venezuela, a country Guyana was simultaneously treating as a territorial adversary [2]. He found that CH4 Systems had five employees on record, a website listing no executive names, and a track record consisting almost entirely of projects inside Venezuela [1]. He found that the consortium’s letter of credit, the financial instrument meant to guarantee performance, came not from an international bank but from Financiera de Fianzas SA, a Venezuelan firm with all offices inside Venezuela, while every other bidder used the Bank of China [1].

The Architecture of Accountability: Procurement, Priorities, and the Gas-to-Energy Project

What REDD documented in 2023 was a puzzle whose pieces did not fit. The consortium’s initial bid of US$898.8 million was nearly double the low bid of US$466.6 million from China Energy International Group [3]. An evaluation team, which included a representative from ExxonMobil, the company that would supply the gas, unanimously recommended the higher bid [3]. The US State Department confirmed that the Commerce Department’s Advocacy Center had provided active support to the consortium following what it described as a thorough review [1]. Yet CH4, one of the two consortium members, had five employees, no public leadership, and no record of having led a project at this scale [1].

The question Bodzin was asking in 2023 was the right one: how much due diligence did anyone actually do?

What Kaieteur News has now documented in 2026 is the answer arriving in real time. Weekly private jet commutes from Houston, refueling in Puerto Rico, touching down in Georgetown, have accumulated since October 2022, totaling, according to the reporting, US$70 million in flight costs alone [4]. Industrial materials, such as PVC pipe and construction components, were shipped not by maritime freight or standard air cargo but flown into Ogle Airport on the same charter jets that carried executives, at inflated cost [4]. A project budget that has absorbed an additional US$50 million from ExxonMobil, yielded US$82 million in liquidated damages awarded to the contractor for government delays, and is now the subject of negotiations for a further US$250 million top-up [4] [5] [6]. The Gas-to-Energy Task Force is apparently considering converting the entire arrangement to a cost-plus basis, which would eliminate all remaining financial risk for the contractor [4].

And then there is the flight manifest from February 21, 2026, the Hawker jet N17TV departing Ogle for Opa Locka, Miami, carrying the CEO of Lindsayca, the CEO of Fulcrum LNG, a former ExxonMobil Vice President and Chief Commercial Officer who left the company and incorporated a firm the government then hired for national gas planning, a KBR Program Director, as KBR is bidding alongside Lindsayca for the Guyana Ammonia and Urea Plant, and the Chairman of the GTE project itself [4] [7] [8]. All of them, in the same cabin, after the Guyana Energy Expo [4].

This is what the absence of serious procurement architecture produces.

GBJ Data Note: The Gas-to-Energy project’s initial bid from the chosen consortium was US$898.8 million, nearly double the lowest bid of US$466.6 million from China Energy International Group.

The structural integrity of a nation’s development is tested not by its revenue, but by its procurement.

Opportunity Cost: US$70 Million in Guyana’s Development Context

To understand the gravity of the US$70 million reportedly spent on flight logistics, one must contextualize it within Guyana’s broader economic landscape. While Guyana is currently the world’s fastest-growing economy, boasting a real GDP growth rate of 43.6 percent in 2024, this macroeconomic success masks persistent disparities [9]. The IDB’s 2024 assessment found that more than half of Guyana’s population lives in poverty, with over 30% experiencing extreme poverty defined as living on less than USD 3.65 per day. And, in the rural hinterland regions (Regions 1, 7, 8, and 9), poverty reaches a staggering 74 percent, compared to 22 percent in Georgetown.

The allocation of US$70 million could fundamentally alter the trajectory of human capital development in Guyana. Consider the following comparative benchmarks:

1. Higher Education and Skills Transfer: The University of Guyana’s entire operating budget for 2026 is GY$14.5 billion (approximately US$69 million) [11]. The flight costs alone exceed the annual funding required to sustain the nation’s primary tertiary institution. Furthermore, the government is currently investing US$150,000 per trainee to build a world-class oil and gas workforce [12]. US$70 million could fully fund specialized training for 467 Guyanese professionals, directly addressing the critical skills gap that currently necessitates importing foreign labor.

2. Secondary Education Infrastructure: The construction of a modern secondary school, such as the recently commissioned Cottonfield Secondary in Region Two, costs approximately GY$1.7 billion (US$8 million) [13]. The US$70 million expenditure is equivalent to the construction of eight to nine fully equipped secondary schools, which could dramatically improve educational access in underserved interior regions.

3. Healthcare Equity: While Guyana has made strides in reducing maternal mortality to 75 per 100,000 live births, the rate remains elevated, and access to specialized care in the hinterland is limited [14]. US$70 million could finance a comprehensive national telemedicine network and deploy hundreds of community health workers across indigenous communities, bridging the geographic divide in healthcare provision.

GBJ Data Note: Guyana’s national poverty rate is 36%, but it soars to 74% in rural hinterland regions, highlighting significant disparities despite the nation’s rapid economic growth.

The US$70 million expenditure is equivalent to the construction of eight to nine fully equipped secondary schools, which could dramatically improve educational access in underserved interior regions.

The Architecture of Accountability

The disparity between the GtE project’s cost overruns and the nation’s developmental needs underscores the necessity for a more equitable use-of-funds framework. Comparable oil-rich small states offer instructive models. Norway’s sovereign wealth fund operates on a strict fiscal rule, ensuring that petroleum revenues are systematically invested in education, infrastructure, and research, rather than consumed by recurrent or opaque project costs [15]. Similarly, Botswana has successfully channeled diamond revenues into human development, achieving middle-income status through deliberate, inclusive growth policies [16].

Guyana’s Natural Resource Fund (NRF), which held a balance of US$3.25 billion at the end of 2025, is designed to finance national development priorities [17]. However, the efficacy of this fund is compromised when major infrastructure projects operate outside rigorous cost-benefit analysis and transparent oversight.

Lloyd Best’s plantation economy thesis holds that the characteristic pathology of Caribbean political economy is not incompetence but structure, that the commanding heights are organized, often with apparent legitimacy, to produce outflows [18]. What is described in Ogle Airport’s flight manifests is not chaos. It is a system working as it was designed to work, for the people who designed it.

As historian Walter Rodney argued, underdevelopment is not an accident of geography; it is actively produced through policy choices [19]. When a state tolerates US$70 million in logistical overruns while rural schools lack adequate facilities, it is making a definitive statement about whose development matters.

The Gas-to-Energy project remains a vital component of Guyana’s economic strategy. However, its success cannot be measured solely in megawatts generated. It must be evaluated by the integrity of its execution and its contribution to genuine human infrastructure. Reallocating resources from opaque logistical expenses toward education, healthcare, and skills development is not merely a matter of fiscal prudence; it is the foundational requirement for transforming an oil boom into enduring national prosperity.

GBJ Data Note: Guyana’s Natural Resource Fund held US$3.25 billion at the end of 2025, but its efficacy is compromised when major infrastructure projects lack rigorous oversight.

When a state tolerates US$70 million in logistical overruns while rural schools lack adequate facilities, it is making a definitive statement about whose development matters.

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References

1. Bodzin, S. (2023). Guyana Hires Small US Contractors for 300MW Power Plant Despite Venezuela Ties. REDD Intelligence.
2. Wikipedia. (n.d.). Guyana–Venezuela crisis (2023–2024). Retrieved from https://en.wikipedia.org/wiki/Guyana%E2%80%93Venezuela_crisis_(2023%E2%80%932024)
3. Kaieteur News. (2026, April 6). Gov’t rejected three cheaper Chinese bids to finance, construct gas plant. Retrieved from https://kaieteurnewsonline.com/2026/04/06/967351/
4. Bagot, D. (2026, April 7). Gas plant contractor draining US$70M from Guyana weekly on luxury flights. Kaieteur News. Retrieved from https://kaieteurnewsonline.com/?p=967473
5. Bagot, D. (2026, April 3). Guyana secretly paid US$80M to Wales gas plant contractor after losing arbitration. Kaieteur News. Retrieved from https://kaieteurnewsonline.com/2026/04/03/guyana-secretly-paid-us80m-to-wales-gas-plant-contractor-after-losing-arbitration/
6. Stabroek News. (2024, May). ExxonMobil in US$50M dispute over Wales project.
7. OilNOW. (2024, June 25). Former Exxon official to lead Fulcrum LNG in Guyana gas partnership. Retrieved from https://oilnow.gy/featured/former-exxon-official-to-lead-fulcrum-lng-in-guyana-gas-partnership/
8. Stabroek News. (2026, March 14). 10 firms bid for ammonia, urea plant at Wales. Retrieved from https://www.stabroeknews.com/2026/03/14/news/guyana/10-firms-bid-for-ammonia-urea-plant-at-wales/
9. International Monetary Fund (IMF). (2025). World Economic Outlook: Guyana.
10. Guyana Business Journal. (2026, April 2). The Sixty-Year Argument.
11. Ministry of Finance, Cooperative Republic of Guyana. (2026, January). Budget 2026.
12. Department of Public Information (DPI). (2026, February). Guyana investing US$150,000 per trainee to build world-class oil and gas workforce.
13. News Room Guyana. (2025). Construction progressing on new Cottonfield Secondary School.
14. World Bank Gender Data Portal. (2023). Maternal Mortality Ratio: Guyana.
15. Norges Bank Investment Management. (2025). About the fund.
16. International Monetary Fund (IMF). (2024, July). Management of Botswana’s Diamond Revenues.
17. Bank of Guyana. (2025, December). Natural Resource Fund Quarterly Report.
18. Best, L. (1968). Outlines of a Model of Pure Plantation Economy. Social and Economic Studies, 17(3), 283-326.
19. Rodney, W. (1972). How Europe Underdeveloped Africa. Bogle-L’Ouverture Publications.

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