GOG opts for Arbitration

Government of Guyana

In connection with the ongoing disputes arising under the Engineering, Procurement, and Construction (EPC) contract between the Government of Guyana (GOG) and Lindsayca/CH4 (LNDCH4), the Dispute Avoidance and Adjudication Board (DAAB) issued formal decisions on January 31, 2025. Both parties were allotted a 28-day period to decide whether to pursue arbitration. On February 27 – within that timeframe – each party served a Notice of Dissatisfaction on the other, thereby signaling its intention to initiate arbitration.

The arbitration will be administered by the International Chamber of Commerce (ICC), with the venue in Washington, D.C. Pursuant to FIDIC’s DAAB procedures, all DAAB decisions in this matter are confidential. Notwithstanding the disputes, both the Government of Guyana and LNDCH4 recognise the strategic importance of the project to the Guyanese economy. The contractor has resumed onsite activities, including piling, and preparations for foundation work are imminent. Construction of a cement batching plant is underway, steel for foundation work has been delivered to the site, and a man-camp is being established, with more than 170 workers currently mobilised.

Upon completion, the project is expected to substantially lower electricity generation costs, enabling Guyana Power and Light Inc. (GPL) to reduce tariffs by up to 50%. This reduction has significant implications for the Guyanese economy, fostering more competitive production costs and stimulating broader economic growth. ExxonMobil Guyana Limited (EMGL) has already finished constructing the gas pipeline, and the transmission lines and substations required for integration of the project are significantly advanced, with completion anticipated by mid-year. Despite the pending arbitration, both parties remain committed to expediting the power plant and natural gas liquids (NGL) plant, aiming to ensure the timely relocation of the gas and steam turbines, which are already in Guyana, to the Wales site.