FID deadline nearing on Uy’s $2-B Tanglawan LNG project

By Myrna M. Velasco – December 3, 2019, 10:00 PM
from Business Mirror

The extended deadline to reach final investment decision (FID) for the US$2.0 billion Tanglawan liquefied natural gas (LNG) import facility and power projects of Davao businessman Dennis Uy will expire next month, but mandated milestones have yet to be presented to the Department of Energy.

Uy’s LNG ventures had been given six-month extension on its notice-to-proceed (NTP) in July and that will lapse January next year, as indicated by the energy department. The first NTP or the license for the company to implement its project was granted in December 2018; and application for extension was filed in June and approved the month after.

As a condition, Uy’s Phoenix Petroleum Philippines Inc. and its partner China National Offshore Oil Corporation (CNOOC) should already reach FID – and it also entails that the joint venture will already have their engineering, procurement and construction (EPC) contractor, identified the lenders for the project and shall be ready to advance the targeted facilities to construction phases; and must also have targeted market for its gas imports.

Phoenix Petroleum indicated previously that it shall be having its “groundbreaking rites” this December, but until now, the site of the proposed LNG onshore import terminal has yet to be identified and firmed up.

In the last disclosure made by Phoenix Petroleum, it stated that it has been in “continuing discussion” with CNOOC on the prospective signing of a joint venture agreement.

Nevertheless, Energy Secretary Alfonso G. Cusi admitted that CNOOC had not communicated yet with government on any next steps or plans on its LNG joint venture with Phoenix Petroleum.

“For Tanglawan, we have not received any communication from them. We have extended it the last time, we have not accepted any letter from them yet. It’s still too early to discuss and I don’t like to-preempt anything,” he said.

Back in September, government officials have hinted of slowdown in CNOOC’s investment-discussions on the LNG venture in the Philippines and they raised fears that it might eventually bolt out from the project, but Uy’s group assured the Chinese firm is still in the investment game.

“The company continues its talks with CNOOC pertaining to the joint venture agreement with CNOOC,” the Uy-led firm has told the Philippine Stock Exchange.