Government is yet to finalise the financial contract and date for breaking ground for the multi-million dollar ReGen facility at the George Town landfill, according to the chief officer in the Health and Wellness Ministry.
Speaking in Finance Committee on Wednesday, Nellie Pouchie shared that government does not have an actual “[breaking ground] date” for the project to commence construction.
Pouchie, responding to questions from Opposition Leader Roy McTaggart who asked for an update on the project, did say that government is continuing with the capping and the remediation of the George Town landfill.
“That’s what you’re seeing in progress now, that continues up until 2022. We have not yet reached financial close with respect to the main waste to energy plant and that aspect of the programme,” Pouchie said, as McTaggart asked if the timeline for the project will be pushed further back.
“We do not have an actual break date for that yet. We do have to reach financial close to be able to have that contract finalised before we can do that,” she added.
While she did not respond to the impact on the project’s timeline, Pouchie said, “the actual date for the close of that financial contract is the end of September, so we have not yet reached that point”.
Work continues on EIA
As the financing contract is being finalised work is progressing on the Environment Impact Assessment for the waste to energy project. The public consultation phase of the terms of reference for the EIA was concluded back in June.
We look forward to beginning the agreed baseline environmental studies, and reaching financial close on the contract, which typically happens some months after commercial close and contract signing. – Cameron Graham, Dart President Development Delivery & Infrastructure
Cameron Graham, Dart President Development Delivery & Infrastructure, responding to queries from the Cayman Compass on Pouchie’s statement, said, as the chief officer indicated, the ReGen project continues to progress.
“Earlier this year, the Cayman Islands Government and Dart completed the first round of public consultation as part of the Environmental Impact Assessment for the project. We look forward to beginning the agreed baseline environmental studies, and reaching financial close on the contract, which typically happens some months after commercial close and contract signing,” he explained, adding, “the public-private project team is making good progress on capping the main waste mound at the George Town Landfill.”
The project was formalised in March by the Alden McLaughlin-led National Unity government, with construction costs pegged at $205 million, which will be met by Dart.
At that time, the McLaughlin administration signed the commercial contract for the project.
Once Government and Dart signed the contract earlier this year, both parties became contractually committed to implementing the project.
After the public-private partnership contract is signed, additional steps are required before project implementation can begin, including reaching a ‘financial close’.
A financial close occurs when all the project and financing agreements have been signed, all conditions met, and the private sector partner can start drawing down the funds to start work on the project.
This process typically requires a lot of detailed work and effort by the public and private sector partners.
The cost of remediating the site would be paid for by the withdrawal of $22.7 million from the government’s Environmental Protection Fund, government had announced then.
Under the plan announced in March, when the commercial contract was signed, once ReGen is operational, government will pay the Dart consortium an average of $163 per ton for processing waste at the site which was set to be completed by 2024.
Construction of the project, which is a private-public partnership contract between the Dart-led consortium and government, was initially announced to begin between 2022 and 2024. Until the energy recovery facility is complete, waste will continue to be landfilled and remediation of the north mound will be completed.