FirstGen, Japan LNG project slates start
The facility’s commercialization will augment the country’s natural gas supply by utilizing the terminal’s floating storage and regasification unit
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The facility’s commercialization will augment the country’s natural gas supply by utilizing the terminal’s floating storage and regasification unit
An integrated liquified natural gas or LNG and regasification terminal in Batangas province, worth over $1 billion and being built by Lopez-led First Gen Corp. and partner Tokyo Gas, is expected to finally begin commercial operations by the end of the year.
The facility's commercialization will augment the country's natural gas supply by utilizing the terminal's floating storage and regasification unit.
"We hope to commission the LNG plant sometime by the end of October. After that, about two weeks or a month of running, we have to come up with a systematic way to run it fully on LNG and then fully on Malampaya," FGen president and chief operating officer Francis Giles Puno said in a spot interview with reporters on Monday.
Operation starts by yearend
"By the end of the year, the facility will be operational. We just need to figure out how we can supply the LNG market. Usually, LNG is more expensive during winter and it becomes more affordable in summer months," Puno said.
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FGen's partner, Tokyo Gas, is one of the largest purchasers of LNG in the world with an annual volume of 14 million tonnes per annum. It has over 63,000 kilometers of gas pipelines serving more than 11 million customers.
LNG is a significant source of fuel diversification to complement the efforts of the Malampaya consortium to optimize the sustainability of the remaining indigenous gas in the Malampaya-Camago reservoir.
Once the LNG plant is up and running, FGen and the Razon-led Prime Infrastructure Capital Inc., which holds the Malampaya operatorship, can proceed with their proposed gas aggregation strategy.
Under the gas plan, First Gen's LNG facilities will help blend the extracted volumes of indigenous Malampaya gas with imported LNG that will therefore increase local supply and soften the impact of high gas prices due to geological tensions.
"It will take a lot of work to run LNG and Malampaya. But in the long run, the Malampaya (facility) will stay because the new consortium will invest in it. Hopefully, with the idea of the Department of Energy or DoE, the mix will translate to more affordable electricity cost," Puno said.
The Malampaya project uses indigenous natural gas to reduce the country's oil imports. It has been powering up to 20 percent of Luzon's total electricity requirements. It supplies natural gas to power four power generation plants in Batangas with a combined capacity of 2,011 megawatts or MW.
Aside from FGen's venture, the DoE has also approved several LNG terminal projects undertaken by Linseed Field Corporation, Energy World Gas Operations Philippines Inc. Excelerate Energy L.P., Vires Energy Corporation, Shell Energy Philippines Inc. and Samat LNG Corporation.
According to the Department of Energy, the nation's usage of natural gas is projected to increase to a minimum of 24,263 MW by 2040 in the Reference Scenario, and 18,883 MW in the Clean Energy Scenario, up from the present 2,011 MW of power generation.
