Malampaya, First Gen units sign gas supply deal

By Manila Standard Business – January 5, 2024, 9:40 pm

Prime Energy Resources Development B.V. managing director and general manager Donna Kuizon Cruz (seated, fourth from left) presents the new Malampaya gas sale and purchase agreement to Department of Energy (DOE) Undersecretary Alessandro Sales (third from left). With them are other officials of the DOE, Prime Energy and First Gen Corp.

PRIME Energy Resources Development B.V. on Friday announced the signing of a long-term gas sale and purchase agreement (GSPA) by the Malampaya Consortium with the wholly-owned subsidiaries of First Gen Corp. that operate gas-fired power plants.

The new GSPA will continue the supply of Malampaya gas to the power plants with their gas supply contracts expiring in 2024.

The consortium and First Gen presented the new GSPA to Department of Energy (DOE) Undersecretary Alessandro Sales. The landmark deal will ensure continued supply of indigenous fuel to four gas-fired power plants in Batangas with a combined capacity of 2,011 megawatts including Santa Rita, San Lorenzo, San Gabriel and Avion facilities, according to Prime Energy.

“This is a significant achievement that will contribute to the Philippines’ energy security. We are very grateful for the support of the Department of Energy, First Gen, and our partners in the Malampaya consortium in the successful negotiation and signing of the new GSPA,” said Prime Energy managing director Donnabel Kuizon Cruz.

Prime Energy and its partners—UC38 LLC, PNOC Exploration Corp. and Prime Oil and Gas Inc.—said they are ramping up preparations to drill at least two deepwater wells in 2025 (Camago and Malampaya East) to potentially increase and extend gas supply from Malampaya. Production from the new wells is expected in 2026.

The Santa Rita and San Lorenzo power plants have been using Malampaya gas since 2001.  The San Gabriel and Avion power plants started using Malampaya gas in 2017 after the completion of Malampaya Phase 2 and 3.