State-run Philippine National Oil Company (PNOC) is exploring a potential partnership with local firm BERGS Energy Solutions and Technology Corp. (BESTC) to develop a large-scale natural gas power project.

The company said Monday that it signed a Memorandum of Understanding with BESTC to study the feasibility of jointly developing a three 600-megawatt (MW) natural gas-fired combined cycle power plant and a floating storage regasification unit (FSRU) at PNOC’s Industrial Park, which, if successful, could generate up to 1,800 MW of new capacity. 

The planned project is intended to help stabilize power supply and improve affordability. 

The agreement also covers liquefied natural gas (LNG) infrastructure to boost energy security and support the transition to cleaner fuel sources.

PNOC said the initiative “aims to provide lower electricity prices, meet the growing energy demand, and support the government’s efforts in the transition to cleaner energy sources.”

The proposed combined cycle power plant will use natural gas, which emits less carbon than coal, while the FSRU will enable the import and regasification of LNG to supply the facility and potentially other power plants.

PNOC President and CEO Ma. Cristina Sheila C. Cabaraban signed the agreement alongside BESTC President Bernardo P. Babaran, with senior officials from both companies present.

The Philippines targets to raise the renewable energy (RE) share in its power generation mix to 30 percent by 2030 and 50 percent by 2040 under the Philippine Energy Plan.

Natural gas complements this shift as it balances intermittent RE sources and emits about 50 percent less carbon dioxide than coal-fired power.