2nd Dennis Uy-Chinese firm partnership may get government okay approval soon

By Lenie Lectura – November 23, 2018
from Business Mirror

A SECOND Dennis Uy-Chinese firm partnership may soon win its second big-ticket contract.

Department of Energy (DOE) Undersecretary Donato Marcos said on Thursday after the launch of the Philippine Conventional Energy Contracting Program (PCEP) that the application submitted by Tanglawan Philippines LNG Inc. is “almost complete.”

Tanglawan is the partnership between state-owned China National Offshore Oil Corp. (CNOOC) and Philippine fuel retailer Phoenix Petroleum. After evaluation, the DOE is expected to issue a notice to proceed (NTP). Under DOE Department Circular 2017-11-0012 or the “Rules and Regulations Governing the Philippine Downstream Natural Gas Industry,” companies that plan to build an liquefied natural gas (LNG) facility have to seek prior approval from the agency.

“We are still evaluating. Most likely, it will be finished in the first week of December,” Marcos said when asked when the DOE would be able to fully conclude its evaluation.

In June CNOOC and Phoenix signed a memorandum of understanding to study, plan and develop an LNG receiving terminal project in the Philippines.

Last month the DOE received Tanglawan’s application. However, this was returned because it lacked a certificate of registration from the Securities and Exchange Commission (SEC).

Marcos said on Thursday that Tanglawan was able to comply and submitted to the DOE the required SEC registration. Based on Tanglawan’s application, it plans to build an LNG hub with an initial capacity of 5 metric tons per annum. Two sites in Batangas are being explored, he said.

“Phase 1 is 5MTPA and, of course, their proposal is onshore. They are looking at two sites; they have a memorandum of cooperation or understanding with AG&P and they are also looking at National Development Corp. land,” said Marcos, who noted that an onshore LNG project, which includes a gas power plant, is estimated to costbetween $1 billion and $2 billion.

Tanglawan is among the 23 firms that expressed interest to put up an LNG hub in the Philippines. So far, Tanglawan is the only company that submitted an application for an LNG terminal.

Marcos said Limay LNG Power Corp., in partnership with ChinaEnergy, also submitted an application albeit “in a different location.”

“Limay’s application is for a power plant in Bataan and they are looking at trading through their own LNG receiving terminal. We suggested they don’t have to build another LNG terminal because they can negotiate with whoever wins the Batangas terminal,” Marcos said. The other firms that expressed interest are Cleanway Energy Development, First Gen Corp., CGN New Energy Holdings Co. Ltd., Vires Energy Corp., DeEnergy International Corp., SK E&S Co. Ltd., Carmine Energy Pte. Ltd., Transformation Llc., Kepco E&C, Atlantic Gulf & Pacific Co., Osaka Gas Co. Ltd, Llyods Energy, PhiLNG Ltd. Pte. and BKB Consortium.

The Philippine National Oil Co. also wants to participate. It is actively scouting for its partner.

However, Marcos said on Thursday the state firm has “slowed down because they can see that the DOE is about to issue an NTP.”

The National Telecommunications Commission earlier declared Dennis Uy’s Mindanao Islamic Telephone Co. Inc. and ChinaTelecom as the country’s third telco player.