First Gen taps Japanese firm for EPC of LNG terminal
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LOPEZ-led First Gen Corp. has tapped Tokyo-listed JGC Corp. for the engineering, procurement, and construction (EPC) of its $1-billion liquefied natural gas (LNG) terminal in Batangas.
Both firms will focus on completing a study on modifications to allow its existing jetty to receive large- and small-scale LNG vessels and continue to receive liquid fuel.
In a disclosure to the stock exchange on Monday, First Gen said that JGC was chosen the tenderer, marking the conclusion of an extensive EPC tendering phase which commenced in 2014 where it was able to lure 18 companies out of the 22 invited.
First Gen said in partnership with JGC, both firms will focus on completing a study on modifications to allow its existing jetty to receive large- and small-scale LNG vessels and continue to receive liquid fuel.
Upon completion of the study, First Gen will commence with the construction of the modified jetty, which will be able to accommodate a Floating Storage Regasification Unit (FSRU) on an interim basis. An FSRU is an LNG storage ship that has an onboard regasification plant capable of returning LNG back into a gaseous state.
This will allow the terminal to receive LNG as early as 2021, even prior to the expiration of the Malampaya gas contracts in 2024, First Fen said.
“First Gen believes the project and the early entry of LNG will play a critical role in ensuring the energy security of the Luzon Grid and the Philippines, particularly as the indigenous Malampaya gas resource can no longer be counted on at all times to produce and provide sufficient fuel supply for the country’s existing gas-fired power plants, and certainly not for additional gas-fired power plants,” the company said.
“The entry of LNG will encourage new power plant developments, as well as industrial and transport industries to consider it as a replacement to more costly and polluting fuels.”
To recall, the Luzon Grid experienced more than 90 intervals of red alert and over 270 intervals of yellow alert from March to June.
First Gen broke ground for the largest LNG terminal in May this year but it deferred anew the construction of the project to early 2020 as it was yet to settle its financial investment decision. The deferment is subject to approval of the Department of Energy.
