By NEIL HARTNELL
Tribune Business Editor
nhartnell@tribunemedia.net
FOCOL Holdings is in negotiations with a US government-owned institution to finance its “nine-figure” investment in transforming New Providence’s baseload energy generation, its chairman revealed yesterday.
Sir Franklyn Wilson told Tribune Business that the BISX-listed firm and its affiliates are in talks “at a very high level” with the US Export-Import Bank, the federal government arm that funds and underwrites credit for American exporters, over financing pipeline and power plant projects where “the first of the nine figures is not one, two or three”.
Speaking after it was disclosed that FOCOL and its Bahamas Utilities Holdings affiliate will construct a 13.5 mile pipeline to move both liquefied natural gas (LNG) and diesel fuels from Clifton Pier to Blue Hills, where they will also build a new 177 mega watt (MW) power plant, he pledged that both facilities will adopt “the highest possible standards” to mitigate any safety and environmental concerns.
Dexter Adderley, FOCOL’s president and chief executive, confirmed to this newspaper that its role in the Government’s energy reforms will “be in full swing next year” once all necessary permits and approvals are obtained for both the pipeline and power plant.
Explaining that the pipeline will largely follow the route of BPL’s existing fuel transportation mechanism, which it will ultimately replace, he reassured residents in nearby residential communities that it will be constructed to North American and global standards to allay any safety concerns.
A study on the potential environmental impacts, produced by Bahamas-based JSS Consultants and dated August 6, 2024, said: “The FOCOL diesel and natural gas pipelines project is a proposed 13.5-mile pipeline project in Nassau, New Providence, The Bahamas. The site is located between the BPL Clifton power plant and the BPL Blue Hills power plant.
“The proposed site is not currently inhabited but is near established roadways, agricultural lands and populated urban areas… The proposed works include the construction of modern diesel and natural gas pipelines and associated infrastructure.” The study noted that the pipelines’ proposed route will take it close to two national parks managed by the Bahamas National Trust (BNT).
“The FOCOL diesel and natural gas pipelines project does not fall within the boundary of a national park but is located north of the Primeval Forest National Park (PFNP) and south of the Harold and Wilson Ponds National Park,” the report by JSS Consultants said.
“The Primeval Forest national park is 7.5 acres of old growth, dry broadleaf evergreen forest with poignant karst features. Harold and Wilson Ponds national park is 237 acres of inland freshwater wetland habitat. These sites are managed by The Bahamas National Trust (BNT).”
Sir Franklyn explained that the pipeline project will replace aged BPL infrastructure, which is long past its expiry date, with a fuel transportation mechanism that is more modern and resilient in the face of climate change impacts.
“There is considerable, real and serious expertise within FOCOL, and the company’s directors are retaining additional expertise to check, scrutinise and execute,” he said of the new pipelines and power plant.”This is a very transformative thing. A big part of this initiative is replacing something that must have been there for 50 years. BPL must have been there for 50 years. At some point we have to get rid of it.”
While unable to give a timeline for when construction will start, as this depends on the planning and environmental approval processes, Sir Franklyn promised that it will be built to “the highest possible standard. I speak on behalf of the Board of Directors when I say the highest possible standards will be involved”.
He was echoed by Mr Adderley, who asserted that the existing fuel line between BPL’s Clifton Pier and Blue Hills plants is “overdue for replacement”. He explained that the track for new pipelines “goes mostly through the pine forest in parallel with the transmission and distribution lines” belonging to BPL.
According to the FOCOL chief executive, the proposed pipelines will follow and parallel Frank Watson Boulevard in south-west New Providence before crossing Coral Harbour Road and then moving past Carmichael Village as they track Carmichael Road. They will then turn north up Gladstone Road, then turn east across Fire Trail Road before heading to the new Blue Hills facility.
“We’re not deviating from the existing transmission and distribution route” between Clifton Pier and Blue Hills, Mr Adderley said. “These will be built to the same standards they are built to in North America and anywhere else in the world.
“Natural gas is very safe. We are using world class organisations, world class companies to design and build it so it will be extremely safe. At the public consultation [on the environmental study] we’ll have a demonstration where we show all the safety components of the project, all the details of how it will be built and be ready to address any concerns the public might have.”
The LNG fuel for Bahamas Utilities Holdings’ new power plant will be offloaded from vessels at Clifton Pier before being taken to Blue Hills. Mr Adderley said the company hoped to start construction of the pipelines “within a couple of months” of obtaining all necessary permits, adding that they will “take more than half a year” to build. The construction pace will be aligned with the 177 MW power plant’s progress and needs.
Sir Franklyn, meanwhile, told this newspaper that the Government will retain “significant control” over the pipelines FOCOL and its affiliates will construct, although he did not provide any details. “At the end of the day, the Government will pretty much control,” he added. “This is almost a matter of national security. The Government’s influence will not be insignificant.”
As for financing the power plant and pipelines, the FOCOL chairman revealed: “I can confirm it’s at a level where we are in negotiations with the US Export-Import Bank at a very high level to execute on this project; to do this, where we’re in very serious discussions with the US Export-Import Bank at a very high level, and they have very high standards.
“The investment thing, there’s no point in breaking it out into bits and pieces. This initiative is a nine-figure initiative, and the first figure is not one, the first figure is not two or three.” Various Cabinet ministers in the Davis administration have estimated that BPL needs around $500m in fresh investment in its nationwide generation and grid assets, with New Providence alone needing at least $300m of that.
The Government, through outsourcing New Providence’s baseload energy generation and grid, is handing the task of financing and delivering more affordable, reliable, cleaner and environmentally-friendly energy to the private sector via its industry-wide reforms.
It is unclear whether Donald Trump’s election to the US presidency will have any impact on the US Export-Import Bank talks, and Sir Franklyn did not comment on this aspect yesterday. However, Mr Adderley said Bahamas Utilities Holding’s 177 MW power plant – still in the development stages – is “what is needed to upgrade the infrastructure and provide cleaner, more reliable power generation to the community”.
He added: “The engineering work is in process. We’re now in the engineering and permitting phase; the early stages. You’ll see work starting early in the New Year. The team are working aggressively, and it’s our commitment to have it [the power plant] completed as soon as it is practical. It will be rolled out in phases, and as each phase is complete the benefits will start to accrue.
“We have been hiring, recruiting all year practically. We’ve been beefing up. We’re ensuring a significant amount of job opportunities for Bahamians. We are literally hiring people every day. It’s an ongoing process. We have a team dedicated to recruiting new talent and we’re committed to maximising opportunities for Bahamians.”
Mr Adderley did not provide figures for the number of construction and full-time jobs that FOCOL and Bahamas Utilities Holdings’ projects will generate, and referred this newspaper to the Ministry of Energy and Transport when asked for a price range at which the 177 MW plant will sell energy to BPL.
However, he did confirm that the BISX-listed firm will be installing another 30 mega watt (MW) turbine made by General Electric (GE) at the existing Blue Hills power plant in 2025. This follows behind the original two GE engines, with a combined 60 MW output capacity, that were introduced at Clifton Pier last month.
“That was phase one,” Mr Adderley said. “That was completed and those two units are online currently. Next year we’ll be rolling out and installing an additional turbine at Blue Hills in preparation for the transition to natural gas. They are much more efficient and gas ready. They will be dual fuel and ready to consume natural gas from day one. Next year we’ll be in full swing once we have all the permits in place.”
Sir Franklyn also sent Tribune Business a video in which Festus Ayeni, GE Vernova’s services business head for north, central and south America, described The Bahamas as a potential “showcase” for the turbine manufacturer in terms of what its engines can do.
Revealing that GE is negotiating a 30-year service agreement with FOCOL to take care of the units it has supplied, Mr Ayeni said: “We believe The Bahamas can be a showcase for us globally; to showcase the power partnerships, working with FOCOL, working with GC, and just the capabilities of our units.
“This will be one of the first baseload projects that we have here in the islands where we are powering the whole island, so we’re super excited and looking forward to this being a test case for years to come. I think this is going to be a unique test case and unique opportunity for us to demonstrate working with a sovereign government, sovereign country….”
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Publish date : 2024-11-08 04:40:00
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