Big guns reveal $3-B initial bid
Both LNG and renewables are needed to achieve a balanced energy mix and well-planned energy transition
Daily TribuneBoth LNG and renewables are needed to achieve a balanced energy mix and well-planned energy transition
The first quarter is not yet over, but 2024 is already shaping up to be a year of collaboration among powerhouses in the local business towards one goal of improving the lives of Filipinos through a massive project that will have an initial $3-billion infusion.
Three industry giants, namely Meralco PowerGen Corp., or MGen, Aboitiz Power Corp., and San Miguel Global Power Holdings Corp., or SMGP, were confirmed to join forces to launch the country’s first integrated liquefied natural gas, or LNG, facility in Batangas.
In a $3.3-billion deal, MGen and AboitizPower will infuse capital into two SMGP gas-fired power plants: the 1,278 megawatts, or MW, Ilijan plant and a new 1,320 MW combined cycle facility expected to begin operations in late 2024.
Together with SMGP, they will also invest in nearly 100 percent of the LNG import and regasification terminal owned by Linseed Field Corp.
Additionally, all three companies will acquire Linseed Field Corporation’s LNG import and regasification terminal, which will be used to receive, store, and process LNG fuel for the two power plants.
The deal integrates the local energy sector into the global natural gas supply chain.
Pathbreaker
MGen chairperson Manuel V. Pangilinan described the partnership as a “pathbreaking venture.”
“This is a pathbreaking venture. Apart from transforming the energy landscape of the Philippines, this symbolizes a milestone alliance among major players in the energy industry toward a more sustainable future.
“We are thrilled to have such reliable partners as we lay the foundation for a brighter, greener future,” Pangilinan said.
Filipinos win
For AboitizPower chairman Sabin M. Aboitiz, the tie-up is a “big win for the Philippines and the people.”
“Both LNG and renewables are needed to achieve a balanced energy mix and well-planned energy transition. Economic development is impossible without energy security, and this investment is a definitive step forward in that direction,” Aboitiz said.
For his part, SMGP chairperson and president Ramon S. Ang said: “For the first time, three leading power companies are working together to secure our country’s energy needs while transitioning towards cleaner power sources.”
“This represents a major leap forward for our energy future, ensuring not just reliability but also cost-efficient power for many Filipinos,” he added.
Ensuring energy security
Through advanced LNG storage and regasification capabilities, this collaboration will significantly boost the nation’s power supply with over 2,500 MW of generation capacity once fully operational.
Importantly, it will make affordable power accessible to a broader segment of Filipino consumers.
By leveraging their combined expertise and resources, the collective venture guarantees the delivery of dependable and competitively-priced energy while helping boost economic growth and environmental preservation.
Likewise, the initiative supports the Marcos administration’s objective of increasing the use of natural gas in the country’s energy mix, thereby enhancing energy security and propelling the nation toward a greener and more sustainable future.
As outlined in the Philippine Energy Plan, the Department of Energy said LNG is crucial for the country’s energy sustainability and security. It also plays an important role in boosting natural gas share in the power generation mix to 26 percent by 2040.
LNG offers significant environmental advantages over traditional fossil fuels as it reduces greenhouse gas emissions, combats climate change, improves air quality, and enhances public health — making it the ideal transition fuel to a renewable energy future.