Tractebel to Call for LNG Construction Bids Q204

Belgian energy company Tractebel plans to call for bids sometime in the second quarter on construction contracts for its US$600mn liquefied natural gas (LNG) project being developed in the Bahamas, Tractebel's project manager Jim Ebeling told BNamericas on Tuesday.

The idea is to start construction by early Q3, he said. Construction will take 32-36 months, with operations starting up in mid-2007.

The project will supply 832 million cubic feet a day (mcf/d) of natural gas to southern Florida via a pipeline from its proposed LNG receiving terminal on Grand Cayman Island in the Bahamas.

The US Federal Energy Regulatory Commission (FERC) issued its final environmental impact study (FEIS) on January 23 for the US section of the pipeline that is part of the project. "The staff concludes that approval of the proposed project with the appropriate mitigating measures as recommended would have limited adverse environmental impact," the FERC statement said. However, the general public has an opportunity to comment on the FEIS and the FERC will review those comments before deciding to approve the project, Ebeling said.

"There will be a period of fine tuning and addressing concerns for a period of some weeks, with us providing information to the FERC," Ebeling said. "I'm confident we will have a fairly quick turnaround on the process, given that we've worked with a lot of these entities before."

The US section of the 24-inch pipeline, called Calypso, is 42.5 miles from the Exclusive Economic Zone (EEZ) boundary - between the US and Bahamas - to shore in Florida's Broward County. The pipeline is 90 miles in total length, On the Bahamian side, Tractebel has submitted its final environmental impact assessment (EIA) to the authorities and is working with the Bahamas Environmental Science and Technology (BEST) regulatory commission, which is reviewing the EIA, Ebeling, said.

Meanwhile, Tractebel's gas engineering subsidiary has already carried out front-end design studies for the LNG terminal. Tractebel is still negotiating LNG supply contracts with Trinidad and various African and Middle Eastern countries.

The FERC gave its approval on January 22 for a similar project proposal by US-based AES Corporation to transport gas to Florida from the Bahamas and fellow US company El Paso is planning a similar project, but Ebeling says the project is not "a race" because there will be enough gas demand in Florida by 2007-2008. Market estimates indicate Florida will require more than 9,600MW of additional power generation capacity by 2007, requiring some 2 billion cubic feet a day of natural gas.

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