AIC Trinidad and Guardian Holdings aim to have 50% equity stakes in ECGPC, whose only business is developing the project and which is not yet formally constituted as a company. The Intra-Caribbean Gas Pipeline Company (ICGPC) will act as an "intellectual partner" in the project, Seeterram said.
Total investment in the project is estimated at US$400mn-500mn but the actual amount will be defined by a feasibility study being carried out by US engineering company Doris, a subsidiary of Italy's Saipem Group.
Guardian and AIC are putting US$600,000 into the study and expect to receive the results by August, when the partners will make a decision about whether to go ahead. If they do, the pre-construction phase, involving over US$4mn of additional investment, would take place from August to mid-2005, including front-end engineering studies, an environmental impact assessment (EIA) study and preparation of bidding rules, Seeterram said.
The pipeline is designed to deliver about 100 million cubic feet of gas a day (mcf/d) from Trinidad to the eastern Caribbean islands, terminating in Guadeloupe, and could start up in 2007.
The idea is to supply gas to 5-6 power generators on the islands through take-or-pay contracts. The generators currently use fuel oil to generate electricity and could reduce their operating costs by 15-20% by using gas, Seeterram said.
Trinidad's national gas company NGC is facilitating the project and could supply gas to the pipeline, Seeterram said. ECGPC also has the option to buy gas from other suppliers, such as BG, if the price is right.
The project is attractive to AIC and Guardian because it would provide a stable long-term return cash flow with credible offtakers, mainly the French and local utilities in the eastern Caribbean. AIC Trinidad is a subsidiary of Canada's AIC Group while Guardian Holdings is based in Trinidad.
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