The government of St. Vincent and the Grenadines will now own a 49 per cent stake in the geothermal plant being developed in the country.
Originally, Emera and Reykjavik Geothermal, two foreign firms, were to own 75 per cent of the plant, with the remainder going to the government.
But Prime Minister Ralph Gonsalves said on radio Tuesday night that the US$100 million dollar deal has been renegotiated.
“… we have to renegotiate aspects of the shareholders agreement between ourselves and them for the simple reason that originally, they were going for 75 per cent but we have negotiated with them that they would take 51 per cent and we, 49,” Gonsalves said.
He further announced that the project is “at the stage where we have to alter the power purchase agreement between the consortium of Emera and Reykjavik Geothermal.
“That is now ready to be signed between them and VINLEC,” he said, referring to the state-owned power company, which would buy the electricity from the consortium and resell it to consumers.
Gonsalves did not say how the change in share ownership would affect the amount of money the government would now be expected to contribute to the project, to which the consortium had originally committed US$80 million.
The geothermal project was initially scheduled to come on stream this year, but it is not clear whether the government still intends to meet that target.
In 2015, when the Geothermal Project law was debated and passed in Parliament, then-government senator Jomo Thomas and then-Leader of the opposition Arnhim Eustace were among lawmakers who expressed concern that the geothermal venture could expose the country to exploitation by the foreign investors.
Thomas said that there are no man-gods and governments make mistakes all the time. He had further said that big companies might set up the government without batting an eye, adding that profit is the primary concern of the private sector.
And while he acknowledged a need for public-private partnership, he suggested that there is no entity that would give the government the US$80 million to develop a geothermal power plant.
Meanwhile, Leader of the Opposition Arnhim Eustace also noted that most of the US$80 million for the project would be foreign investment.
He asked that the proper safeguards be put in place, saying that if that is not done, the nation may find itself “at a point in time in this process when it becomes outside of our control.
“We will find ourselves dealing with persons who really control the funds that are available and when we have the energy to sell to our utility, they can determine those prices based on a rate of return that has to be agreed with those investors who are involved in the project,” Eustace said.