The Bahamas Government Supports Liquefied Natural Gas (LNG) Projects in The Bahamas

Bahamian Government's Policy Decision in Support of Liquefied Natural Gas (LNG) Projects in The Bahamas

Gov’t Supports LNG

By Candia Dames

Nassau, The Bahamas

2 May 2006

The government has made a policy decision that it is not opposed to liquefied natural gas (LNG) projects in the Bahamas, according to Prime Minister Perry Christie, but he still did not give any timelines for when the government hopes to give the green light to any of the energy companies with LNG proposals.

He said LNG "can happen in the country".

"I think we are making good progress," Prime Minister Christie said in an interview with the Bahama Journal, referring to the government’s consultations and review of the proposals.

"We know that the former government had given a commitment to it, but did not allow for some of the developments that have taken place.  I think that we have had an exhaustive review of it and the government has made a policy decision that it is not opposed to LNG in the country and now it is moving forward to the final review of most certainly at least one of the applications before us."

The prime minister was no doubt referring to the Virginia-based AES Corporation, which is proposing an LNG project at Ocean Cay, near Cat Cay and Bimini.  The company wants to run an LNG pipeline to Florida to help meet that state’s growing demand for energy.

But it has had a wait of several years after it received approval in principle from the Ingraham Administration.  One year ago, AES appeared poised to get final approval from the government, but objections from wealthy second homeowners on Cat Cay further delayed a decision on the matter.

The government is also considering a second proposal from Suez and El Paso Corporations, which have combined a proposal for Grand Bahama after first presenting separate plans.

But the CEO of Suez indicated recently that his company had grown weary of the wait for a decision from The Bahamas government and would seek to get approval from the state of Florida for an LNG project off the Florida Coast.

Last week, Deputy Chief of Mission at the U.S. Embassy in Nassau Dr. Brent Hardt said the government should establish timelines for investors so that when they submit proposals they would have an idea of how long it would take to get an answer.

"I think the worst thing for investors is to continue month after month without clarity," Dr. Hardt said.

When he spoke to the Bahama Journal, the prime minister responded to Dr. Hardt’s comments, intimating that the U.S. diplomat was out of line.

"I am surprised at the comments," Prime Minister Christie said.  "That’s like me saying the same thing about the United States of America.  I assume he is well intentioned in saying it, but I think sometimes Dr. Hardt doesn’t realize what a minister or a cabinet has to do in balancing development applications."

He added: "Oftentimes, there is an application that has important policy implications.  For example, LNG was one where some people feel very strongly about opposing the installation or establishment of a facility in The Bahamas and it took time for that process to move forward, more time than those who would have wished it to happen in Florida would have allowed for and so timelines couldn’t help that process."

Mr. Christie said the government needed the time it took to consider the LNG applications and will make an announcement after it is has concluded final review of the proposals.

"That process just had to have time for consideration, the time for consultation and I think people have to understand that a country moving forward with a huge infusion of cash coming into it, inflows, development proposals, the question [is] how far we have to go in developing our country at a time when we don’t even have the manpower to service the construction jobs," the prime minister told the Bahama Journal.

"So, a lot of consideration goes into decision making. Sometimes there are those persons who are looking from outside [who wouldn’t know]."

LNG Project Approved

By Candia Dames

candiadames@hotmail.com

Nassau, Bahamas

16th December

 

 

 

 

Minister of Trade and Industry Leslie Miller told the Bahama Journal yesterday that the government has approved in principle the proposal submitted by the AES Corporation to build a liquefied natural gas pipeline in The Bahamas.

 

The minister was asked to respond to reports in the Trinidadian press yesterday, which quoted him announcing the approval at the IBC/Energy Caribbean conference.

"We intend to diversify and expand the economic mix which will enable us to move ahead", he said. "The environment and tourism impacts can and will be addressed and the government intends to provide the clarity and stability necessary to attract these investments."

Minister Miller's announcement came on the same day that the Tractebel and El Paso energy companies and FPL Group Resources were announcing an alliance geared at sealing the government's approval to carry out a similar project in the northern Bahamas.

Some Bahamians, particularly those who are a part of environmental groups, are worried about a possible adverse environmental impact any LNG project could have.

AES officials have tried to placate those anxieties, assuring communities in The Bahamas and South Florida that any negative impact would be negligible.

Company officials continue to point to the significant benefits that such a project would bring to The Bahamas.

According to Project Director Aaron Samson, the AES project for The Bahamas would pay $7 million a year in business license fees.

The project is also expected to create about 450 jobs during the construction phase and 25 to 35 permanent employment opportunities.

"We're convinced that this is a very finance-able project and we won't have difficulties bringing it to fruition", Mr. Samson told the Bahama Journal in an earlier interview.

Company information says AES owns or has an interest in 160 plants in 23 countries.

Local environmentalists like those belonging to the group ReEarth continue to raise concerns regarding such projects.

ReEarth spokesperson Sam Duncombe has questioned whether companies like AES choose The Bahamas for their projects because of "our country's very loose environmental laws."

"I think a lot of it is that if they choose The Bahamas they would avoid the environmental laws that they would have to adhere to in the United States", she has told the Bahama Journal.

But it is a criticism Mr. Samson has repeatedly dismissed as he pointed to the unwavering commitment that AES has to the strictest international environmental standards.

The entire project would include a liquefied natural gas import terminal; a liquefied petroleum gas removal plant; a seawater desalination plant; an undersea pipeline to supply potable water from Ocean Cay to North Bimini; as well as Ocean Cay employee housing and associated facilities on South Bimini, and an undersea natural gas supply pipeline.

The Bahamas Trade and Industry Minister, Leslie Miller says that The Government may Very Well Approve All Three Proposals to Lay Liquefied Natural Gas (LNG) Pipelines between The Bahamas and Florida

Minister Leslie Miller said he is "absolutely" satisfied that all of the environmental concerns raised regarding the proposed LNG projects have been addressed

Bahamas Gov't Closing Pipeline Deal

By Candia Dames

candiadames@hotmail.com

Nassau, The Bahamas

08/03/2004

Environmentalists fighting three projects to lay liquefied natural gas pipelines between The Bahamas and Florida appear to be losing that battle, with Trade and Industry Minister Leslie Miller saying Sunday that the government may very well approve all three proposals.

Minister Miller told the Bahama Journal that the AES Corporation continues to lead the race for The Bahamas Government's approval for its project, with a heads of agreement nearly finalized.

Two other companies - Tractebel and El Paso - are also moving close to convincing authorities to give them the go-ahead, the Minister said.

Minister Miller said he is "absolutely" satisfied that all of the environmental concerns raised regarding these projects have been addressed.

He also said that international professionals have already determined that the projects would pose no significant threat to the environment.

But it was recently reported in the Florida press that Tractebel, a Belgian company, was facing fines from the Florida Department of Environmental Protection for scraping, crushing or dislodging 29 corals while taking samples of the ocean in preparation for its LNG project.

Minister Miller said Minister of Health and Environment Dr. Marcus Bethel and officials at the Bahamas Environment Science and Technology Commission [BEST] have been working hard to address environmental issues raised in relation to the three proposals before the government.

But BEST Commission Chairman Keod Smith continues to be against approving any LNG project in The Bahamas, saying that the legislative framework is not yet in place.

Minister Miller on Sunday pointed out that the benefits that such projects would bring to the Bahamian people would be significant.

For each project, Minister Miller said, the government would get between $5 million and $10 million for the initial license.

In year one of any of one of the projects, the government would get $10.8 million in various fees; in year five, that figures is expected to double; in year 10, it is expected to increase to $30 million; and by year 15, the government should be getting $40 million to $50 million from a company operating an LNG facility in The Bahamas, Minister Miller said.

Meanwhile, the AES Corporation has secured a partnership with Repsol, Europe's fifth-biggest oil company, to supply liquefied natural gas for what is says will be a $700 million project.

The companies expect to officially announce the deal shortly, according to AES Project Director Aaron Samson.

Minister Miller told the Bahama Journal that the arrangement between AES and Repsol strengthens the LNG proposal.

No company produces the LNG as well as sells it, Minister Miller explained.

Mr. Samson said Friday that while the approval is preventing his company from moving forward, he is satisfied that AES will soon get the necessary permits.

When asked whether the new partnership with Repsol was an indication that AES was facing financial instability, Mr. Samson said that was certainly not the case.

"We're not a producer of LNG," he explained.  "We never purported to be a producer of LNG.  We never pretended that we'd be doing this thing alone."

Mr. Samson said the partnership with Repsol will not impact the proposal before the government in any way and that relevant government authorities have already been informed about this development.

He said Repsol would transport the LNG via ships from Trinidad to the AES site at Ocean Cay, near Bimini.  The LNG would then be turned to the gaseous form and sent through a pipeline to South Florida.

While AES awaits final approval, it continues to carry out "environmental remediation" at Ocean Cay, Mr. Samson said.

The AES pipeline, which would run from Ocean Cay, would deliver natural gas to markets in Florida, as would the other two pipelines being proposed.

Customs Officer Accused Of Terrorizing Investors

By Candia Dames

candiadames@hotmail.com

Nassau, Bahamas

09/02/2004

Customs officials have reassigned a senior officer who had been stationed at Ocean Cay, near Bimini after he clashed with an executive of the AES Corporation, which operates an aragonite mining operation there.

 

In a report to Customs Comptroller John Rolle, Sandy Stubbs, the officer involved in the recent incident, said he feared for his life due to the "aggressive attitude and action" of AES Project Director Aaron Samson.

 

But Mr. Samson, whose company is also seeking the government's permission to build a liquefied natural gas plant on the cay, has denied that he was out of order in dealing with the customs officer, who he claimed was "terrorizing" AES workers.

 

The Customs Comptroller said that his officers are investigating the incident to determine exactly what happened and who may have acted improperly.

 

The whole matter stemmed from another incident that happened weeks earlier.

 

AES officials reportedly believe that Mr. Stubbs, who was stationed on the cay on a rotational one-month basis, was a good friend of a Bahamian AES worker who had been suspended by his supervisor. It is believed that Mr. Stubbs held a grudge against company officials.

 

Following the suspension, Mr. Stubbs allegedly ordered that AES Operations Manager Bruce Fitzgerald and diesel mechanic, Johnny Stott, be deported even after Immigration authorities on Bimini assured him that the expatriates had the necessary documents for their employment in The Bahamas.

 

But Mr. Stubbs insists that he was following proper procedures.  He reportedly confined the men to their quarters for hours then redirected an AES charter plane back to the United States with the workers on board.

 

Mr. Samson flew to Ocean Cay the following day to deal with the matter, which was reported to Trade and Industry Minister Leslie Miller and made an informal complaint to the Customs Department.

 

In his report, Mr. Stubbs said that Mr. Samson asked him to meet him at the AES office so that he could call the Minister, who had reportedly asked Mr. Samson to get the customs officer on the phone.

 

But Mr. Stubbs said he wanted to first call Customs headquarters in Nassau to inform authorities about the situation.

 

"I spoke to Mr. Miller and relayed the incident to him," he wrote. "Mr. Miller agreed with me for following instructions and procedures. However, he did ask if I could be more lenient with them (AES). He then went on to tell me about the LNG project in details and the benefits of such a project."

 

Minister Miller recently told the Bahama Journal that AES is "very close" to getting approval for the LNG project and the government expects to bring in millions of dollars annually as a result of the investment.

 

Mr. Stubbs said Minister Miller also asked him to come and see him when he came to Nassau.

 

Minister Miller confirmed to the Journal that he did speak with Mr. Stubbs regarding the incident, but he suggested that Mr. Stubbs may have exaggerated it.

 

The Minister also said he asked the customs officer to treat the foreign investors "in a delicate manner and with respect".

 

"I stated to him that I was concerned that you are ill treating foreigners," Minister Miller said. "I spoke with him for less than a minute. I asked him to be careful how he deals with foreign investors."

 

He also confirmed that Mr. Stubbs had locked away the foreign workers.

But Mr. Stubbs, in his report, claimed to be the victim.

 

Mr. Stubbs said after being approached by Mr. Samson, "I asked him if he was threatening a government official. He then asked me what kind of official do I think I am? He told me again that I was on his Cay. His and Leslie Miller."

 

He continued, "As I walked to the Customs office, he continued to follow me shouting at me and using degrading remarks to refer to me."

 

Mr. Stubbs also said in his report that, "After the phone conversation [with Minister Miller] Mr. Samson in an angry and loud voice, asked me who do I think I am and how dare I embarrass his people! I told him I was only doing my job and following procedures. He then said he don't quite care about procedures.

 

"He told me that he was having a meeting with his staff at the cafeteria and that I dare not come around there if I know what's good for me. I continued to walk to my office in silence and then proceeded to write this report."

 

But Mr. Samson said, "I categorically deny that I threatened him. It was an unfortunate incident. I got involved so that an unruly official would stop terrorizing and threatening my employees."