Favorable PD on Southern LNG Critical, Say Foreign Suppliers
British Gas Trinidad and Tobago Ltd. (BGTTL) may get an early
Christmas present. It has asked FERC to issue a preliminary
determination (PD) on Southern LNG's proposal to recommission its
liquefied natural gas terminal facility at this Wednesday's
meeting. FERC has placed the project on the agenda --- so BGTTL is
half way there --- but whether it will issue a PD is quite another
If the Commission should fail to award a PD at its meeting this
week, not only would the future of Southern LNG's recommissioning
of its Elba Island, GA, terminal be in jeopardy, but it could
thwart an LNG expansion project overseas and the development of
extensive gas reserves, according to an official with BGTTL.
BGTTL has a vested interest in the outcome of the FERC
proceedings because its affiliate, British Gas Trinidad LNG Ltd.,
is a shareholder in Atlantic LNG Co. of Trinidad and Tobago, which
owns the liquefaction facility in Trinidad that would supply LNG to
the Southern LNG terminal. Moreover, another BGTTL affiliate is a
partner in a consortium that would produce the natural gas to be
liquefied by Atlantic LNG and shipped to Southern LNG.
Based on a favorable PD on Dec. 15, Atlantic LNG plans to
proceed with an expansion of its Trinidad LNG facility, and the
consortium-known as the NCMA Developers-plans to develop the
offshore natural gas fields in the North Coast Marine Area, which
have proven gas reserves of about 2 Tcf, the BGTTL official told
FERC in a Dec. 7 letter [CP99-579]. "The economics for this
proposed LNG expansion project depend upon sales of LNG to both
U.S. and Spanish markets. Either market alone would be insufficient
to support [it]."
In order to retain the Spanish portion of the market, BGTTL and
other project sponsors must finalize their investment commitments
in the upstream LNG expansion project this month, the official
noted. But a favorable PD is needed first, he said.
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