Sunday, March 3, 2013

First Gen to spend $2.3B on natural gas facilities


Business World Online
Posted on March 03, 2013 09:32:07 PM


POWER GENERATION firm First Gen Corp. plans to spend around $2.3 billion on its San Gabriel natural gas project in Batangas, a top company official said on Friday last week.

  “The San Gabriel project will come in three phases. All three phases will cost roughly around $2.3 billion,” First Gen President and Chief Operating Officer Francis Giles B. Puno told reporters at The Peninsula Manila in Makati City.

Mr. Puno said the first phase will involve construction of a 100-megawatt (MW) natural gas-fired power plant, which is expected to be completed by next year.

“The first phase is roughly $100 million only so we can probably utilize internally generated cash and some additional debt. We’re building the 100 MW by the second half of this year and we’re hoping to get it done by the summer months next year,” Mr. Puno said.

The second and third phases will involve construction of 400-MW and 800-MW power plants.

Mr. Puno said that the second phase, which will cost roughly $400 million, is targeted to be completed by 2016. “The second phase is 400 MW, but it will depend on our ability to contract gas from Malampaya. That’s when we will be able to determine how quickly we can build the 400 MW. But we’re hoping to complete it sometime in 2016,” Mr. Puno said.

The Malampaya gas facility, which is located off Palawan, fuels three natural gas-fired plants in Batangas, namely: the 1,200-MW Ilijan plant, the 1,000-MW Sta. Rita plant, and the 500-MW San Lorenzo plant.

First Gen, through its subsidiaries First Gas Power Corp. and FGP Corp., owns and operates the Santa Rita and San Lorenzo power facilities.

Mr. Puno said the third phase of the project will consist of two units with 400-MW capacity each that will cost a total of around $800 million.

He said this last phase will require imported gas. “That will need imported gas so we’re also looking at the feasibility of bringing in LNG (liquefied natural gas) to Santa Rita. We have space in the Santa Rita site, adjacent to where the power plant is located, where we can build a regasification terminal,” Mr. Puno said.

He said First Gen will be open to partnerships to build the regassification facility, which is estimated to cost around $1 billion.

“We’re open to partners on the regas facility, as well as on the power generation side for the third phase, because that’s 800 MW and those are big investments,” Mr. Puno explained.

The company grew its net income by more than threefold to $167.962 million as of September last year from $48.999 in the same nine months in 2011, according to its latest available financial report.

First Gen shares shed P2.10 or 7.98% to close at P24.20 apiece on Friday last week from P26.30 apiece last Thursday. -- CAMCF   source

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