Tanglawan targets to start LNG hub construction in May

By Danessa Rivera – March 12, 2019 – 12:00am
The Philippine Star

MANILA, Philippines — Tanglawan Philippine LNG Inc., the prospective partnership among Phoenix Petroleum Philippines Inc., state-run Philippine National Oil Co. (PNOC) and CNOOC Gas and Power Group Co. Ltd., is eyeing to start the construction of its  liquefied natural gas (LNG) terminal by mid-May.

Energy Secretary Alfonso Cusi said the group plans to break ground for the project in early May.

“They are looking at getting to partial operations within two years,” he said. “So that by 2024, there is already a substitute in case by then, there will be no Malampaya.”

Tanglawan intends to break ground within the year for the regasification and receiving terminal with a capacity of 2.2 metric tons per annum (mtpa), with commercial operations targeted to start by 2023.

The contract for the Malampaya gas field in northwest Palawan will expire in 2024, but this can be applied for extension with the Department of Energy (DOE).

Operating since 2001, the Malampaya gas project supplies fuel to around 40 percent of gas-fired plants in Luzon namely the Ilijan, Sta. Rita, San Lorenzo, San Gabriel and Avion plants – which supply 3,211 megawatts (MW) to the Luzon grid.

“We are being encouraged to break ground before May 13 or middle of May,” PNOC president Reuben Lista said. “That’s what we’re encouraging ourselves when we signed a memorandum of agreement.”

Signed earlier this month, the MOU will allow Phoenix, CNOOC and PNOC to explore and discuss business opportunities and cooperation in relation to the equity investment in Tanglawan.

PNOC will provide a strategic alliance in further developing the LNG project, with the government-run corporation’s involvement in the areas of pipeline infrastructure and franchise, banked gas, equity, and other marketing opportunities.

Following the MOU, talks are focused on the equity of the three parties in Tanglawan and the banked gas for the planned power.

“We are discussing…it is dependent on our equity into the company,” Lista said. “PNOC will ask for more, but it’s still part of negotiations. But we are quantifying our franchise, our name and other things.”

It aims to develop a gas-fired power generation facility up to 2,000 megawatts (MW) of installed capacity, initially putting up a 1,100-MW gas-fired power plant to become the offtaker of the LNG supply.

“CNOOC has expressed interest, but they will make feasibility study… those are studies that have to be made,” Cusi said.