CHEAPER NATURAL GAS, which will translate into lower energy costs and electricity bills for consumers, will start flowing into Barbados from Trinidad and Tobago “by early 2015”.
That’s the word from an official of the Eastern Caribbean Gas Pipeline Company (ECGPC) following an announcement last week that two big international firms have acquired a majority stake in ECGPC, which is developing an undersea natural gas pipeline from the twin-island republic to Eastern Caribbean nations.
The first phase of the project, which has been in the works for several years, will see a 300-kilometre pipeline running from Tobago to Barbados. Phase 2 will extend the pipeline from Barbados to other Eastern Caribbean islands.
ECGPC spokesman R. Gregory Rich told the SUNDAY SUN that construction on the multimillion-dollar pipeline will begin in another 18 months, with completion expected a year and a half later.
“The project is in the advanced business development stage, meaning that we’ve got all the approvals of the two governments, Barbados and Trinidad and Tobago, and we have identified committed customers in Barbados to use the gas . . . . The two entities that would be using the gas would be Barbados Light & Power (BL&P) for power generation and the other one, which is an important entity but doesn’t need as much gas, is the National Petroleum Corporation (NPC),” he said in an interview from his Trinidad office.
“We have a gas supplier in Trinidad that is committed to providing the gas on a long-term contract and what’s been going on is putting into place the numerous contractual arrangements . . . . There have to be government-level agreements between the two governments that allow us to lay the pipeline and for the pipeline to operate and all those things.
“By early 2015 it should be completed and delivering gas to Barbados.”
Significant savings Although saying it was not possible to put a dollar value on the savings expected for Barbados, which relies primarily on fuel oil to produce electricity, Rich said they would be “significant”.
“It will definitely reduce the cost of electricity,” he declared. “The other thing about it, which is probably as significant, is that it is going to provide for some better predictability about what future electricity costs will be in Barbados.”
The gas will be imported on a long-term contract – between the Barbados National Oil Company Limited (BNOCL), the joint public/private sector company ECGPC, and Trinidad gas supplier Trinity Power Limited – that Rich said would run for at least 15 years.
It is expected that the BNOCL will import the gas and redistribute it to BL&P and NPC.
New York-based private equity firm Beowulf Energy, which operates and manages Trinity Power, and First Reserve Energy Infrastructure Fund (FREIF), one of the world’s leading power and energy investment funds, has now bought into the project.
“The pioneering project will help reshape the regional energy market and reduce dependence on oil-based products,” the ECGPC said in a statement announcing Beowulf’s and FREIF’s acquisition of the majority stake.
Rich told the SUNDAY SUN that the two companies bring not only a wealth of expertise to the project but “large financial resources” that will accelerate the project’s implementation.
In October last year, Minister in the Office of the Prime Minister with responsibility for energy, Senator Darcy Boyce, said Government had initially “moved slowly on the project because it is a big investment in the order of $500 million and we are not paying for it in Barbados in terms of capital costs”.
He said a consortium would raise the funds but Government would pay the transport charge.
