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February 7, 2016

One Caribbean Nation’s Dramatic Increase in LNG Use

An energy company executive’s testimony at House hearing this week shows just how rapidly liquified natural gas can become a major part of a developing country’s economy, especially if it isn’t known for having a native supply of fossil fuels.

Andres Gluski, president and CEO of the AES Corporation, said Wednesday in written testimony that since the infrastructure to import and use LNG was put in place, “the Dominican Republic’s energy matrix has been transformed … natural gas usage went from zero in 2000 to providing 22% of the country’s overall energy usage in 2011.” An analysis by the company found that LNG usage “represents a savings of more than half a billion dollars per year for the Dominican Republic,” Gluski said before the House Foreign Affairs Subcommittee on the Western Hemisphere.

AES, of course, played a big role in developing the Dominican Republic’s LNG infrastructure: “We have invested over $850 million in the Dominican Republic energy sector and are the largest U.S. investor in the country,” Gluski said. “We wholly-own two gas-fired power plants and a liquefied natural gas import terminal, and share ownership in a third thermal power plant together with the Government of the Dominican Republic.”

And there are proposals to use those facilities for broader efforts:

By expanding current AES LNG infrastructure, the Dominican Republic could become the center of a “Hub and Spoke” system whereby LNG would be imported from the U.S. in large, efficient tankers and then re-exported in smaller volumes, likely as LNG or as compressed natural gas, or CNG, to various Caribbean islands.

The Dominican Republic isn’t the only country in the Caribbean region that is expanding its role in the natural gas market. Demand for the fuel is supposed to double in the region over the next decade. Colombia, for example, recently got World Bank support for a $300 million LNG export terminal.


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