But a company official quickly dismissed such concerns, saying that financing was not a concern for AES.
One Bahamas Environment Science and Technology Commission (BEST) official, who asked to remain anonymous while government considers the proposal, said authorities, in fact, have no evidence that the company can deliver on all of what it is planning.
“I doubt that this thing will go,” the official said.
He raised concerns regarding the ability of AES to put into effect an Environmental Management Plan (EMP) for the project.
AES wants to construct a pipeline between Ocean Cay, near Bimini and South Florida.
Trade and Industry Minister Leslie Miller has said that of the three companies seeking the governmental green light to construct liquefied natural gas pipelines between the northern Bahamas and Florida, AES appears best suited to win that approval.
Still, the financial history of the company has been questionable.
Last year, a cash-strapped AES reported that its third-quarter profits fell 39 percent as it worked to bail itself out of financial problems.
But while the company faced some financial woes in the past, it is well positioned to carry out its proposed project, according to Project Director Aaron Samson, who spoke to the Bahama Journal from his office in Coral Gables, Florida.
The financial turnaround was evident Thursday.
Even as the BEST official questioned the company’s financial standing, AES on Thursday reported a third-quarter profit, reversing the loss it posted last year when it took large write-downs for unsuccessful investments.
The company, based in Arlington, Virgina, reported net income of $76 million, or 12 cents per share, compared with a net loss of $315 million, or 58 cents per share, a year ago.
When asked about his company’s ability to deliver on its proposed investment, Mr. Samson said, “If you had asked me that question last year, it might have been a little more difficult for me to answer.
“AES and most energy companies, in particular U.S.-based energy companies, have had a very difficult couple of years due to the repercussions in the business, due to the Enron fiasco. I think AES is strong today, committed to moving forward with this project and we just closed a $700 or $800 million financing in Spain to build a 1200 megawatt power plant there.”
But Mr. Samson said the financing for the Bahamian plant is not yet in place.
He added, “It’s premature without understanding the complete agreement with the Government of The Bahamas to have that in place, but we’re convinced that this is a very financeable project and we won’t have difficulties bringing it to fruition.”
Company information says AES owns or has an interest in 160 plants in 23 countries.
Local environmentalists like those belonging to the group ReEarth continue to raise concerns regarding such projects.
ReEarth spokesperson Sam Duncombe has questioned whether companies like AES choose The Bahamas for their projects because of “our country’s very loose environmental laws.”
“I think a lot of it is that if they choose The Bahamas they would avoid the environmental laws that they would have to adhere to in the United States,” she has told the Bahama Journal.
But it is a criticism Mr. Samson has repeatedly dismissed as he pointed to the unwavering commitment that AES has to the strictest international environmental standards.
This would not be the first time AES has faced such opposition.
One study, for instance, found that a proposed AES project in Uganda violated the World Bank’s policies on involuntary resettlement, environmental assessment, natural habitats, disclosure of information, and the economic evaluation of investment operations, according to CorpWatch, a watchdog organization that seeks to hold corporations accountable for their actions.
According to CorpWatch, that study found that an AES project in Uganda would have been “unfavourable and not always up to International Best Practice.”
AES officials continue to point to the significant benefits that such a project would bring for The Bahamas.
Those benefits were also highlighted in an Environmental Impact Assessment recently completed by Haley & Aldrich, a Boston-based firm that carries out such professional services.
According to Mr. Samson, the AES project for The Bahamas would pay $7 a year in business license fees.
The project is also expected to create about 450 jobs during the construction phase and 25 to 35 permanent employment opportunities.
The entire project would include a liquefied natural gas important terminal; a liquefied petroleum gas removal plant; a seawater desalination plant; an undersea pipeline to supply potable water from Ocean Cay to North Bimini; as well as Ocean Cay employee housing and associated facilities on South Bimini, and an undersea natural gas supply pipeline.
The Ambassador for the Environment Keod Smith – well-known for the stand he took against the proposed Clifton Cay development while in opposition – is expected to hold a press conference next week to discuss various LNG proposals.
The other two companies that are jockeying for governmental approval are El Paso and Tractebel North America.
Candia Dames, The Bahama Journal
