Golding's US expert out of LNG project; New bids expected by Tuesday

ERICA VIRTUE, Senior Gleaner Writer

Ernest Megginson, the American consultant who was hired by the Bruce Golding administration to lead Jamaica's quest to introduce liquefied natural gas (LNG), has parted ways with the Government.

Initial reports had suggested that Megginson's contract had been terminated but this was denied by head of the LNG steering committee, Dr Carlton Davis, who said the consultant had opted to walk away from Jamaica.

"I can confirm that he (Megginson) has decided not to seek a renewal perhaps because of different perspectives on the likely outcomes based on data indications so far," Davis told The Sunday Gleaner.

According to Davis, "bids on the supply of LNG are due on July 17 (Tuesday) and at that point we will have a more complete fix on the four major cost elements."

The major cost elements identified by Davis are the delivery of LNG, the regasification of the supply, the pipeline to transport the gas and the necessary financing of the project.

Other energy options

A-ccording to Davis, the Government will not be putting all its eggs in one basket.

"Other natural gas delivery options as well as other energy options will be explored."

Megginson's was initially contracted by the Golding administration for three-months at US$105,000 (approx J$8.9m).

This led to questions from the then opposition spokesman on energy, now Energy Minister Phillip Paulwell.

He wanted information on the terms of reference, which determined the amount that was being paid to the consultant.

In February 2011, Golding defended the contract sum, saying the country should be prepared to pay top dollars for the expertise it was getting.

Five months later in June 2011, then chairman of the LNG steering committee, Christopher Zacca, defended a plan to retain the service of Megginson at an annual salary of US$426,000 (J$36 million).

The contract included consulting fees, normal living expenses - apartment, car rental and per diem - and the required Jamaican withholding taxes,.

But despite the presence of Megginson, the LNG programme moved at a snail's pace with a moving timeline.

The planned introduction of LNG is already two years behind the initial schedule. However, the Government seems convinced that it will now meet the 2014 deadline.