PIPE DREAMS Only two projects will ultimately send natural gas to Florida.

Three energy companies planning to build pipelines to move liquefied natural gas from the Bahamas to Florida are racing for approvals before one of them is squeezed out. AES Corp., El Paso Corp. and Tractebel are looking at Bahamian sites for terminals, with pipe running to the Florida coast, a route that has never been used for gas pipelines. Industry officials say only two pipelines are likely to be built because Florida’s power demands do not require all three.

Miami-based AES expects construction to begin in 2004 and end in 2006. Its 94-mile, $650-million line would move 850 million cu ft a day, or roughly one-third of Florida’s energy demands, through 24-in. pipe, says AES project director Aaron Samson. Chicago Bridge & Iron has been contracted to build the terminal on Ocean Cay, a 95-acre island in the Bahamas. Three miles of the line must be placed through a U.S. Navy magnetics testing range. That pipe must be stainless steel, because magnetics are sensitive to carbon steel.

"The first company that finishes the project gets the market in Florida for the next five years," says Samson.

Houston-based El Paso Corp. plans to build an LNG plant on Grand Bahama Island, despite an announcement by its El Paso Global LNG division that it is reducing activity. EP is in the process of selling the site it had chosen for the LNG terminal.

Tractebel’s Houston office is planning a terminal for its Calypso pipeline in Grand Bahama Island, at Freeport, ultimately connecting to Florida Gas Transmission’s system. Two 160,000-cu-m tanks and vaporization facilities would send gas through the 90-mile pipeline. The $585- million project is expected to begin construction in early 2004, ending in 2007. Tractebel bought the Freeport site from Enron, which attempted to locate a site in Florida but could not meet government requirements.

AES and Tractebel have preliminary approvals from the Federal Energy Regulatory Commission but not from Bahamian officials. They must also pass environmental reviews. El Paso has not yet applied for a FERC permit.

Rhone Resch, vice president of energy markets at the Natural Gas Supply Association, Washington, D.C, says Florida offers a large growth market for natural gas but only two of the three planned projects will be completed.

(Photo and rendering courtesy of AES)