*

Fulcrum LNG lacks experience and financial backing,

experts say

*

Guyana officials say selection for gas project now

tentative

*

Exxon says it alone will decide whether to tap gas

resources

(Recasts top to spell out implications for Guyana, critics of

the selection are domestic and international)

By Curtis Williams and Kemol King

HOUSTON/GEORGETOWN, Nov 25 (Reuters) - Guyana's dreams

of developing its vast natural gas resources are stuck on the

drawing board five months after it picked a little-known U.S.

startup, Fulcrum LNG, to develop an export project that could

cost up to $30 billion.

Guyana has one of the fastest-growing economies in the

world, thanks to the rapid rise in oil production at lucrative

offshore fields developed by Exxon Mobil ( XOM ). But the South

American country lacks the infrastructure to use the gas

produced at those fields, which is reinjected to maintain

pressure.

The government selected Fulcrum LNG in June over 16

other candidates - including top liquefied natural gas (LNG) and

gas pipeline firms - to develop its gas resources and create a

new revenue stream apart from oil, which is all exported.

The country's leadership said it wanted to expand its

partnerships beyond the consortium led by Exxon that produces

all the oil in the new energy hotspot.

Fulcrum LNG was founded a year ago by former Exxon

executive Jesus Bronchalo.

It was an unusual choice to pull off LNG and

infrastructure projects that will require significant expertise

and financial clout, industry experts and Guyana advisers said.

Fulcrum LNG "lacks requisite experience and a

demonstrated ability to raise the type of multi-billion-dollar

finances required," said Elson Low, an economist and adviser to

the opposition People's National Congress party.

Bronchalo did not respond to Reuters requests for

comment. He is Fulcrum's CEO, secretary, treasurer, director and

president. The only other person associated with the company,

the technical director, also did not respond to requests for

information.

Government officials have begun to describe the

selection of Fulcrum for the contract as tentative.

"No project has been awarded to anyone. We're in an

exploratory phase," Guyana's Vice President Bharrat Jagdeo told

Reuters last month.

That is a shift in the language used by the ministry of

finance when it cited the award of the contract as among its

economic achievements this year. Guyana's president, who

announced the award, said an agreement, that may or may not

include Exxon, was expected next year.

When Fulcrum was selected, Bronchalo said on LinkedIn he was

delighted and honored to be selected "to design, finance,

construct and operate the required gas infrastructure."

The company plans to pair up with U.S. oil services firm

Baker Hughes ( BKR ) and construction contractor McDermott

. Fulcrum's proposal would include financing from the

U.S. Export-Import Bank and the participation of private equity

firms and an environmental partner, the government said.

Fulcrum has yet to make public any details on those

investors.

The U.S. Export-Import Bank and McDermott did not reply to

requests for comment, and Baker Hughes ( BKR ) referred questions to

Fulcrum.

It would be "very difficult" for a startup to raise the

financing for a multi-billion-dollar infrastructure project,

said Ira Joseph, an LNG market expert and senior researcher at

Columbia University's Center on Global Energy Policy.

The project was designed to help the country add to its

energy revenue. Last year, Guyana's take from oil royalties and

fees was $1.6 billion, compared with $6.33 billion in profit

that went to the Exxon-led consortium.

FULCRUM

Guyana picked Nevada-registered Fulcrum, which it said

offered "the most comprehensive and technically sound proposal,"

among the bidders, including China's third-largest oil firm

CNOOC, U.S. gas pipeline giant Energy Transfer ( ET )

, and the No. 4 U.S. LNG exporter Venture Global LNG.

Fulcrum's website does not identify any prior projects, but

claims "extensive experience in origination of new opportunities

to access and capture global LNG markets."

Guyanese officials now say they chose Fulcrum without first

determining whether it could raise the money to tap the enormous

gas reserves.

The technical committee that selected Fulcrum was confident

it could raise money for the projects, Jagdeo told Reuters.

"They represented they had the capacity to raise the money."

Minister of Natural Resources Vickram Bharrat said

Bronchalo's expertise, having worked at Exxon in Guyana and Asia

for two decades helping to negotiate contracts, swung the

selection in his favor.

"We don't have the expertise and capability in government,

especially when it comes to gas ... we expect Fulcrum will have

the capability and experience," he said in an interview in

October.

COLLABORATION OR CONFLICT

Exxon's consortium with Hess and CNOOC has

discovered more than 11 billion barrels of oil off Guyana's

Caribbean coast since 2015, and produced 500 million barrels of

crude from its Stabroek block since 2019, turning the tiny

country overnight into a significant global oil producer.

The government has been pressing the group to come up with a

plan to convert its about 16 trillion cubic feet of gas reserves

into valuable exports such as LNG or relinquish areas where gas

has been discovered so they can be developed by others.

Gas would help develop the country's manufacturing and food

sectors and help make it a regional energy powerhouse.

"Why isn't Exxon building the LNG plant itself?" said

Joseph.

"It is very hard to raise that kind of money to make a

project work, (Guyana) would have to bring in one of the big

players like TotalEnergies or Shell."

The oil major believes it alone can decide how to use

that gas, a person familiar with the company's position said,

citing the agreement it has with Guyana.

So far, Exxon's only planned use for the gas is a small

gas-to-power project.

Exxon's Guyana country manager Alistair Routledge told

Reuters the company would make a decision on tapping newer

discoveries containing mostly gas by mid-2025. He has said the

earliest production could start would be in 2029 or 2030.

Jagdeo said Guyana wants Fulcrum to work with Exxon, but

would push forward with or without it.

If, however, Exxon does not act on the discoveries or return

the acreage for auction to others willing to develop the gas,

Guyana could claw back some offshore land, he said.

"Exxon did indicate that they are interested in the

development of gas, but as the talks continue, we will see how

much commitment is there in regards to gas," Minister Bharrat

said.