By Candia Dames
Nassau, Bahamas
6th June 2005
Florida Power & Light Company (FPL), which
was involved in a partnership with two energy firms to construct a liquefied
natural gas terminal in The Bahamas, has announced that it has temporarily put
on hold a plan to seal a deal for long-term supplies of LNG.
The announcement has placed the fate of one of the LNG
proposals for The Bahamas on an even more uncertain path.
FPL had hoped to carry out an arrangement with El Paso Corp.
and Tractebel Electricity & Gas whereby through their partnership, natural
gas would have been liquefied, shipped from the source and then re-gasified for
delivery to Florida.
Last December, the utility company announced that it had
agreed to combine development efforts and resources with the two energy
companies "in order to bring a new supply of natural gas to South
Florida."
Under that plan, the three companies had planned to carryout
one project. Prior to that, Tractebel and El Paso had been pushing separate LNG
proposals before The Bahamas government.
But in a recent release, FPL announced that it was now
focusing on other potentially more viable options to meet FPL’s increasing
requirements because there appears to be limited opportunity in accessing LNG
at this time.
The Tractebel proposal had called for the construction of an
LNG terminal in the Freeport Harbour while El Paso planned to build a terminal
in East Grand Bahama. But The Bahamas Environment Science and Technology
Commission rejected both sites as being viable locations for the construction
of LNG plants.
Government officials later indicated that the consortium was
eyeing another site in Grand Bahama for the construction of the terminal. The
plan also entails laying an LNG pipeline from the northern Bahamas to Florida.
In December, El Paso spokesman, Aaron Woods, said that both
El Paso and Tractebel will continue their individual efforts on the development
side of each pipeline.
But he said, "Ultimately, one pipeline and one LNG
facility will be built. The companies will be participants in the ultimate
project that is selected."
Although it had indicated last year that it had formed an
arrangement with El Paso and Tractebel, FPL said in its recent release that
none of the proposals received as a result of a request for proposals for the
long-term supplies of LNG presented "sufficiently compelling reasons for
FLP to proceed with its [request for proposals] at this time."
The utility company said in a release, "The lack of
benefit to FPL customers and no bidders meeting all the specifications of the
[request for proposals] contributed to the decision."
Terry Morrison, vice president of FPL’s energy marketing and
trading organization, said in a statement, "We remain interested in LNG,
but we have to know our customers will benefit before we will enter into any
long-term transaction."
The announcement by FPL appeared to have left some
confusion.
Mr. Woods, in an interview with The Bahama Journal from
Houston, Texas last Thursday, said as far as El Paso is concerned, its
agreement with FPL Group Resources, a subsidiary of FPL Group, Inc., still
stands.
"FPL Group Resources, SUEZ (Tractebel) and El Paso
Corporation continue to believe that having LNG and re-gasifying it there in
The Bahamas providing South Florida with an alternative source of natural gas
would be in the best interest of consumers in South Florida," he said.
"Based on the announcement by FPL utility, we are assessing our options and at this time, that’s all the information I have."