MVP’s power-generation unit taps consultant for prospects into LPG
By Lenie Lectura – May 30, 2018
from Business Mirror
THE power business of Manuel V. Pangilinan has tapped a global consulting firm to provide insights on the prospects of venturing into liquefied petroleum gas (LPG).
For now, the power-generation arm of the Manila Electric Co. (Meralco) has not made a decision on whether to take part in the development of the country’s gas sector after plans to pursue it have previously taken a back seat due to pricing and lack of clear energy mix policy.
“No, not yet. I know that we have engaged Mckinsey to advise us on the overall power sector, particularly the generation part of the business, so that we can understand what the role is of renewables and gas in the overall equation,” said Pangilinan, chairman of the country’s largest power-distribution firm. “I think you are all quite familiar with coal as a fuel source.”
Mckinsey in the Philippines serves many of the country’s most successful companies in every major economic sector—including consumer goods, financial services, telecoms, infrastructure, industrials and energy.
Meralco was previously engaged in discussion with Osaka Gas Co. Ltd. of Japan for a possible partnership. They were supposed to work on a feasibility study. However, there has been no development since.
Meralco President Oscar Reyes said the company is looking at all possibilities, including an investment in LNG. “We have to consider the future of Malampaya gas reserve,” which is expected to run out by 2030.
Energy Secretary Alfonso G. Cusi said the government is aiming to turn the Philippines into a hub for LNG.
LNG is natural gas that is converted into a liquid state for easier storage and transportation. Upon reaching its destination, LNG is regasified so it can be distributed through pipelines as natural gas.
The Department of Energy has already issued a regulatory framework on LNG. So far, there are 10 interested firms willing to put up an LNG facility.
Currently, around 3,500 megawatts (MW) of power-plant capacity is dependent on the country’s sole natural gas source.
Latest data from the DOE showed the country’s natural-gas output from January up to August 10 this year amounted to 36,576 million standard cubic feet.
Most of the gas was utilized to boost the country’s power generation. In particular, the data showed 34,852 MMcf of the country’s gas production went to power-generation use, while the industrial sector took up 621 cubic feet.
Meanwhile, the transport industry recorded zero consumption. In all, natural-gas consumption during the period stood at 35,474 MMcf.
In 2017, natural-gas output reached 139,209 MMcf, slightly downfrom the previous year’s 140,516 MMcf.
Of these, 132,256 MMcf was utilized for power-generation use, while the industrial sector took up 2,255 cubic feet. Last year’s natural-gas consumption stood at 134,511 MMcf.
Natural-gas output peaked in 2011 at 140,368 MMcf. Total consumption stood at 137,066 MMcf. The power generation’s share in the output for that year stood at 133,732 MMcf; industrial at 3,288 MMcf; and transport at 47 MMcf.
From 1994 up to May 10, 2018, the same data showed that output reached 1,979,235 billion cubic feet (Bcf), while consumption stood at 1,907,459 Bcf.
During that period, natural-gas consumption for power generation totaled 1,872,725 Bcf; 34,551 MMcf for industrial sector; and 184 MMcf for the transport sector.
