DoE weighs offers from 5 countries for LNG plant

Posted on July 13, 2017
http://www.bworldonline.com/content.php?section=Economy&title=doe-weighs-offers-from-5-countries-for-lng-plant&id=148183

THE Department of Energy (DoE) has listed five countries that have shown “great interest” in participating in the government’s plan to build an integrated facility for liquefied natural gas (LNG), which it targets to finish during the current administration.

“These are the countries that have shown great interest in the project -- Japan, China, Russia, South Korea, and Indonesia,” Energy Secretary Alfonso G. Cusi told reporters on Wednesday on the sidelines of the DoE’s launch of an information campaign called “E-Power Mo” at the Philippine International Convention Center.

“It doesn’t mean that we have shortlisted,” he said. “We are evaluating all the proposals.”

He said he would be meeting on Friday with the Philippine National Oil Co. (PNOC) board of directors “for management to present all these proposals so we can properly evaluate them.” He chairs the board of PNOC, a government agency that has become aggressive in making its assets more commercially viable.

Last month, Mr. Cusi said the DoE was planning the construction of a common receiving and distribution infrastructure for LNG, considered the “cleanest” of all fossil fuels, that is aimed at making the country a hub for the energy resource in Southeast Asia. The facility is planned for a property in Batangas owned by PNOC.

Mr. Cusi previously said the facility would cost around P100 billion and targeted for completion by 2020, which should give the country enough lead time ahead of the anticipated depletion of the Malampaya natural gas find starting in 2024. The offshore Palawan platform supplies gas to several power plants in Batangas. It powers up to 20% of the country’s electricity requirements.

He had said the facility would have an initial 200-megawatt (MW) power plant storage facilities, liqeufaction and regasification units. The plant’s output is aimed to served the country’s economic zones, he added.

Asked when the DoE and PNOC will shortlist project proponents, Mr. Cusi said yesterday that the decision might come after the discussions on Friday. He said the choice could be just one proponent or a consortium.

“This is a project that is a bit complex,” he said, citing the need to find expertise in technical, trading and management solutions.

He said that once a proponent is chosen, he expects the project to break ground in early 2018. He cited two major outcomes that the DoE is targeting to achieve with the project.

“Number one, as a substitute to the Malampaya gas when it is depleted.” he said. “Number two, is we would like for the Philippines to become the hub for LNG.”

The project will allow the country to import LNG, which is transported from other countries in liquid form, then converted back to gas ahead of its use in a proposed power plant.

With its location, the Philippines is strategically located to become an LNG hub and complement activities in Japan and Singapore, Mr. Cusi said, adding that the project could bring economic growth in the country.

“But definitely we want to complete it within the term of [President Rodrigo R.] Duterte,” he said.

The DoE’s “E-Power Mo” campaign aims to make energy issues understandable to ordinary consumers.