Batangas gas pipeline facing new delay

by Alena Mae S. Flores – January 12, 2016 at 11:15 pm

from Manila Standard

The bidding for the 100-kilometer Batangas-Manila (Bat-Man 1) gas pipeline will likely be delayed further pending a revised proposal from the Energy Department.

Economic Planning Secretary Arsenio Balicasan told reporters at the sidelines of a conference that Energy Secretary Zenaida Monsada had raised certain issues on the Bat-Man 1 bidding.

“There are certain issues raised by DoE. We are waiting for their submission of that,” Balicasan, who is also the secretary-general of the National Economic and Development Authority, said.

The  pipeline is one of the critical natural gas infrastructure projects of the government. It is estimated to cost between $100 million and $150 million.

Balicasan said the Neda board’s approval “would depend on how quickly DoE can address these issues and priorities they are putting in.”

“We are aiming it as a PPP project but DoE wanted to revisit other options. It’s up to DoE and the proponent. Neda is facilitating the process to make sure it meets all the requirements,” he said.

Balicasan said Monsada wrote Neda expressing an opportunity to present her side on the Bat-Man 1 project.

“It just has to do more with the assumptions of the project. They wanted to show a different case, other options and we would have to study a way and cost benefit, whether if it is more advantageous from the point of view of the economy, the government, public sector, consumers. We have to look at those angles when we decide whether it’s PPP, GAA or loans,” the official said.

Monsada earlier said while the Bat-Man 1 was approved by Neda Investment Coordinating Council, “we don’t want the project to become a white elephant.”

She said the project could be elevated for approval to the Cabinet once the questions raised by Neda, the Finance Department and Energy had been addressed.

“In principle, this is a government project. We don’t want it to be delayed but we want to be sure that once it’s tackled by the board, everything will go smoothly,” she said.

Monsada earlier said after Neda decided on the Bat-Man 1 privatization scheme, the contract to build the project would be bid out.

The Japan International Cooperation Agency earlier conducted its own study on the prospects of the Philippine natural gas sector. The study has found that there was a 600-megawatt demand from industries located along the pipeline.

Jica said the demand from these industries, excluding power generation companies, would justify the construction of the pipeline.