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MVP firm ready to submit proposal to develop LNG terminal
THE group of tycoon Manuel V. Pangilinan is expected to submit its proposal signifying its interest to develop a liquefied natural gas (LNG) integrated terminal under the Department of Energy’s Philippine Downstream Natural Gas Regulation (PDNGR).
Pangilinan said a company “between Meralco [Manila Electric Co.] and MPIC [Metro Pacific Investments Corp.]” is “about to submit to the DOE.”
“We have to prepare our own brief,” he said in a BusinessMirror report on July 31.
The Department of Energy has so far received letters of interest from 13 local and foreign firms interested to put up an LNG hub, which will initially consist of a floating storage and regasification unit with an initial capacity of 200 megawatts, scalable to 800 MW.
This is envisioned to be completed by 2021 or 2022, before the expected depletion of the Malampaya offshore gas find near Palawan island in 2024.
The 13 firms are Atlantic Gulf & Pacific of Manila, JERA Co. Inc., Limay LNG Power Corp., Kepco E&C, China National Offshore Oil Corp., Carmine Energy PTE Ltd., SK E&S Co. Ltd., Transformation Ltd., Tokyo Gas Corp., Cleanway Energy Development Corp., First Gen Corp., Philippine National Oil Co., and Vires Energy Corp.
Pangilinan said his group would like to sit down with the DOE to further discuss the future of LNG in the country.
“The industry alone cannot decide on the mix. The government has a big say. They will approve the power plants and the costs to produce them. There is a need to have a dialogue between the industry players and the government. Renewable energy has to be part of the equation. We have to map out a plan that both the government and industry will agree on,” he said.
“You have to look at the long-term profile of coal prices, gas prices, renewables prices, because that will drive power costs, including capital investment. We have engaged McKinsey; they’re at it for so many months already. We see all sorts of numbers here and there. It’s not an easy problem that’s why I can appreciate why the government is taking time to decide, but it’s getting late so let’s sit down, talk about it and agree,” Pangilinan said.
Meralco was previously engaged in discussion with Osaka Gas Co. Ltd. of Japan for a possible partnership. They were supposed to work on a feasibility study. However, there has been no development since.
Pangilinan said his group is interested to build either an LNG onshore or a floating storage and regasification unit.
“Gas terminals are just a means to an end…. What is the cost of that terminal? Will it mean higher power rates? It takes a minimum of three years to build a gas terminal, minimum of 10 years to build a gas field. So, we are slowly hitting the wall if we don’t move,” Pangilinan said.