Published September 28, 2019, 10:00
PM By Myrna
M. Velasco
The Department of Energy (DOE) has
finally approved the notice-to-proceed (NTP) for the propounded floating
storage regasification unit (FSRU) of American firm Excelerate Energy L.P.,
which will likely command an investment of US$250 million.
Based on the submitted work program
of the Texas-headquartered company, the construction of the FSRU facility will
start October this year until June 2021 or within a stretch of two years.
Upon completion of the facility as
targeted third quarter of 2021, its prospective market will be the gas fleet
expansion of SMC Global Power Holdings of the San Miguel group.
As stipulated with the energy
department, the diversifying conglomerate is eyeing to lean on gas supply
sourcing from the FSRU for its expanded gas-fed generating assets of aggregate
1,800 megawatts (MW).
The site of the FSRU installation
will be proximate to the existing 1,200MW Ilijan gas-fired power plant in
Batangas. The power plant itself is anticipated to be turned over to the San
Miguel group in 2022, following the conclusion of its independent power producer
administrator (IPPA) contract with state-run Power Sector Assets and
Liabilities Management Corporation.
According to the DOE, the FSRU
installation of Excelerate Energy “will have a storage capacity of 150,000
cubic-meters, to be located at about 9.5 kilometers offshore in the Bay of
Batangas.”
On the project timeline set out by
the US firm, Energy Secretary Alfonso G. Cusi indicated that “by the third
quarter of 2021, we are expecting that Excelerate’s FSRU LNG facility will
commercially operate.”
The energy chief noted that the slew
of approvals granted on LNG storage facilities had been anchored on the
anticipated gas production decline; then the eventual depletion of the
Malampaya field.
Relative to the NTP, the project
proponent is required to comply with the conditions precedent within the
prescribed six months prior to advancing into construction phase.
Such shall include the submission of
permits from various government agencies as well as endorsements from relevant
local government units.
And at the stage where it already
concluded financial closing, it will need to submit proof of such to the energy
department.
Once that is accomplished, the DOE
shall subsequently issue the permit-to-construct (PTC) that will then authorize
the actual construction of the facility.
On the gas offtake agreement, the
energy department indicated that the power generation investment arm of the San
Miguel group already “expressed interest to be the target power customer of
Excelerate.”
By January 2022, SMC Global Power
laid down that it will be requiring new round of gas supply to satiate its
requirements over 15 years.
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