British Gas Trinidad and Tobago Ltd. (BGTTL) may get an earlyChristmas present. It has asked FERC to issue a preliminarydetermination (PD) on Southern LNG’s proposal to recommission itsliquefied natural gas terminal facility at this Wednesday’smeeting. FERC has placed the project on the agenda — so BGTTL ishalf way there — but whether it will issue a PD is quite anothermatter.

If the Commission should fail to award a PD at its meeting thisweek, not only would the future of Southern LNG’s recommissioningof its Elba Island, GA, terminal be in jeopardy, but it couldthwart an LNG expansion project overseas and the development ofextensive gas reserves, according to an official with BGTTL.

BGTTL has a vested interest in the outcome of the FERCproceedings because its affiliate, British Gas Trinidad LNG Ltd.,is a shareholder in Atlantic LNG Co. of Trinidad and Tobago, whichowns the liquefaction facility in Trinidad that would supply LNG tothe Southern LNG terminal. Moreover, another BGTTL affiliate is apartner in a consortium that would produce the natural gas to beliquefied by Atlantic LNG and shipped to Southern LNG.

Based on a favorable PD on Dec. 15, Atlantic LNG plans toproceed with an expansion of its Trinidad LNG facility, and theconsortium-known as the NCMA Developers-plans to develop theoffshore natural gas fields in the North Coast Marine Area, whichhave proven gas reserves of about 2 Tcf, the BGTTL official toldFERC in a Dec. 7 letter [CP99-579]. “The economics for thisproposed LNG expansion project depend upon sales of LNG to bothU.S. and Spanish markets. Either market alone would be insufficientto support [it].”

In order to retain the Spanish portion of the market, BGTTL andother project sponsors must finalize their investment commitmentsin the upstream LNG expansion project this month, the officialnoted. But a favorable PD is needed first, he said.

Susan Parker

©Copyright 1999 Intelligence Press, Inc. All rightsreserved. The preceding news report may not be republished orredistributed in whole or in part without prior written consent ofIntelligence Press, Inc.