Forum Energy to start nat gas production in Q4

By Ted P. Torres (The Philippine Star) Updated August 10, 2011 12:00 AM  MANILA, Philippines -  Forum Energy Plc will start the production of natural gas in the last quarter of the year from the Libertad gas field in Cebu, with a maximum potential of up to three megawatts (MWs). Initially, the Libertad gas field can power a one-MW power plant in the Visayas grid. The Libertad gas field is situated in northern Cebu and lies within Service Contract 40. The field was discovered in the late 1950s but was not developed. A testing program was carried out from 1993 to 1995 involving the drilling of around seven wells, with one of the wells tested positive for gas. “It could even be earlier than the fourth quarter,” said Jose Raymund Apostol, president of Forum Energy’s Philippine unit. Forum Energy carried out a feasibility study in 2004 to determine the most commercially viable option for the development of the field. The results recommended a development plan using three gas-to-electricity generators, which will be developed by DESCO, a leading provider of petroleum and geothermal products and services in the Philippines. Forum Energy had earlier signed a gas sale and purchase agreement with DESCO for the development of the Libertad gas field for power generation. Forum Energy will act as gas supplier to DESCO. Under the agreement, DESCO will install within the power generating units in Bogo, northern Cebu using GE Jenbacher gas engines. Forum Energy will sell the gas to DESCO at an agreed rate of $1.50 per million British Thermal Units (BTU) for the first 0.70 billion cubic feet of gas extracted and utilized, and $1.60 per million BTU for any gas produced beyond 0.70 BCF. Apostol earlier said DESCO would supply electricity from the gas plant to Cebu Electric Cooperative Inc. Forum Exploration Inc., a wholly-owned unit of Forum Energy, holds 66.66 percent of the Libertad project while Forum Pacific Inc. owns the remaining 33.33 percent.