LNG terminal joint venture investing $2b in Batangas

By Alena Mae S. Flores – January 11, 2019 at 09:40 pm
from manilastandard.net

Tanglawan Philippine LNG Inc. may invest close to $2 billion to put an integrated liquefied natural gas terminal and power plants in the country, officials said Friday.

Tanglawan recently received from the Department of Energy a notice to proceed in building an LNG terminal in Batangas.

“The cost reported in the NTP for the regas terminal is $686 million. The power plant at 3 x 360 MW is estimated at $1.3 billion,” Phoenix Petroleum Philippines Inc. vice president of external affairs Raymond Zorilla said.

Phoenix said in a disclosure to the Philippine Stock Exchange Tanglawan would be a joint venture between the company and CNOOC Gas and Power Group Co. Ltd, China’s largest LNG importer and terminal operator,

It said the joint venture arrangement was being finalized. Phoenix is a company led by businessman Dennis Uy.

Tanglawan plans to break ground by 2019 for the LNG re-gasification and receiving terminal with a capacity of 2.2 metric tons a year. Commercial operations are scheduled to start in 2023.

Phoenix said the LNG facility “will help support the demand for a clean and reliable energy source in Luzon and contribute to the sustainable development of the Philippine economy.”

The integrated long-term project plan aims to develop a gas-fired power generation facility with up to 2,000 MW of installed capacity.

“The terminal is only stage one of our plans for the facility. We will develop it to become an LNG hub, giving Filipinos access to low-cost and environment-friendly energy supply,” said Phoenix chief operating officer Henry Albert Fadullon.

Phoenix, established in 2002, became publicly listed in July 2007. It has since grown to be a national brand from its humble beginnings in Davao.

In just 15 years, Phoenix expanded its network and portfolio from trading and distribution of refined petroleum products to terminal and hauling services, selling and marketing of liquefied petroleum gas, bitumen and convenience store retailing.

The DoE has been pushing for the development of the LNG hub to secure the country’s power requirements in preparation for the eventual depletion of the Malampaya gas project in northwest Palawan starting 2024. The Malampaya gas project currently supplies to five power plants in Batangas with a combined capacity of 3,000 MW.

PXP Energy Corp., meanwhile, has an agreement to acquire up to 49 percent of Phoenix’s interest in the LNG venture, as part of the subscription agreement with Dennison Holdings Corp., subject to the approval of partner CNOOC. Phoenix and Dennison are companies owned by Uy.

PXP, a unit of Philex Mining Corp., is an upstream oil and gas company with a total economic interest of 53.1 percent in service contract 72 (Recto Bank).