The expansion of existing pipelines or Tractebel’s Calypso development by itself would be unable to meet the burden.
In its final environmental impact statement for the AES Ocean Express project, a copy of which has been seen by The Tribune, the Federal Energy Regulatory Commission (FERC) said it had evaluated three alternatives to the company’s plans – the expansion of the existing FGT and Gulfstream interstate pipelines to accommodate the 0.842 Bcf per day capacity the company is proposing to transport to the US from Ocean Cay, its man-made island off Bimini – and the Calypso pipeline. The FERC, in its assessment of the feasibility of expanding and extending both the FGT and Gulfstream pipelines, said both would require substantial upgrades to meet Florida’s projected future energy demands.
Such moves would also impact a combined 3,000 acres of residential areas, wetlands and stream crossings, resulting in them not being “environmentally preferable” to the AES Ocean Express design. As for Tractebel’s Calypso pipeline, the FERC said it viewed both as “complementary” in meeting Florida’s energy needs, adding that neither would be capable of delivering the projected 2.39 Bcf demand by themselves.
The FERC said: “We view the Ocean Express and calypso pipelines as potentially complementary for delivering enough natural gas to meet projected demand. Our analysis determined that a single 24-inch diameter pipeline designed for the capacity of the proposed Calypso pipeline or the similar capacity of the proposed Ocean Express pipeline would be incapable of delivering enough natural gas to meet this demand.
“We determined also that expanding the pipeline in either case to increase capacity would reduce, for engineering reasons, the length of an achievable HDD to traverse the nearshore reefs.”
In addition, the FERC said: “Expansion of the FGT or Gulfstream systems would not diversify supplies of natural gas to Florida. The LNG terminal in Ocean Cay, Bahamas, which would be the source of gas to Ocean Express, would be receiving natural gas from international sources in the Atlantic Basin.
“Thus, by not relying on a domestic source of gas, Ocean Express would introduce new sources of supply to Florida, consistent with the recommendation of the White House National Energy Policy Development Group.”
Meanwhile, the FERC said its environmental analysis of the proposed AES Ocean Express, Tractebel and El Paso LNG projects, which all involve receiving LNG in its liquid form by ship at Bahamas-based terminals, where it is regassed and then transported by pipeline to Florida, had shown the AES project was likely to have the least environmental impact of the three.
The FERC assessments, though, do not cover the Bahamian portion of any project and the fact AES is rated as having the least impact does not mean the US regulator will rule against the other two.
In its statement on the AES Ocean Express project, the FERC said it still had to receive an environmental impact assessment from El Paso, although that company had submitted one to the Bahamas Environment, Science and Technology Commission (BEST). The Bahamian agency is currently reviewing that.
However, for its portion of the assessment, the FERC said: “It is anticipated that Seafarer [El Paso’s project] would cross and potentially impact a significantly greater number of wetlands than either the Ocean Express or the Calypso project. This is due to the considerably longer onshore pipeline route for Seafarer.”
Although the FERC’s recommendations may be favourable, AES still has to receive approval for its environmental impact assessment from the Bahamas. Once approved, the company would then have to sign a Heads of Agreement with the Government and develop an Environmental Management Plan for its Ocean Cay facility and the pipeline located in Bahamian waters.
By Neil Hartnell, The Tribune
