Meralco PowerGen Corp. is now considering other development options for the 660-megawatt coal-fired power project of Redondo Peninsula Energy Inc. in Redondo Peninsula, Subic, Zambales, including converting it into a liquefied natural gas facility, officials said over the weekend.
RP Energy, a joint venture among Meralco PowerGen, the power generation arm of Manila Electric Co., Therma Power Inc. of the Aboitiz Group and Taiwan Cogeneration International Corp., earlier put the development of the coal project on hold because of construction and power supply agreement issues.
“Without PSA, we have no recourse but to call them off and say we will now open our options not just with the Korean contractor, but in fact, we’re now looking at other options. It might be new technology, it might no longer CFB [circulating fluidized bed],” Meralco PowerGen president Rogelio Singson said.
“If I were asked, I would only settle with ultra-supercritical. Second, we’re also considering LNG. We’re in that stage,” Singson said.
Aboitiz Power chief operating officer Manny Rubio earlier said the project encountered unforeseen technical issues, specifically “instability in one of the slopes.”
“Shareholders [decided to put it]…on hold position until we complete our technical assessment of what technology and when. In the meantime, we are holding off our site because there is value in the site – there is transmission connection nearby and SBMA approval,” Singson said.
Singson said RP Energy should come out with a decision within the first half of the year to proceed with the project.
“But in the meantime, we’re saying let this rainy season pass and see stability of the site
Because the stability of the site is another challenge. Geology problem, there are landslides that’s why we got delayed,” he said.
Singson said the site stability issue was being addressed to contain the landslide.
“We’re addressing that. We don’t want to be a violator of environmental disaster in that site… In the meantime, we’re consulting experts in terms of what’s the best solution to stabilize that. It will also depend on technology…Depending on the new technology, we will determine which sites are ideal,” he said.
Singson said the shareholders were looking at the economic viability of converting the project into LNG, which would also require new permitting process.
“[It] depends on economics and when to start. There’s also a limited window for new plants to be built. We’re also looking at demand side, supply side and so on,” he said.
“In general, we’re saying we’re open to changing the technology from the original 2x300 CFB,” the official said.
Meralco PowerGen chairman Manuel Pangilinan said there were many considerations that should be taken into account for converting RP Energy’s coal plant into LNG.
“Well, if we do convert into gas, it will be a customer of the terminal. The question is how do we transport the gas from the terminal in Batangas,” Pangilinan said.
Tanglawan Philippine LNG Inc., which has been given a notice to proceed for the construction of its LNG terminal, proposed to put up its facility in Batangas.
“I think we’re studying it. [I’m] not really sure if it’s feasible. Now, if you build a big gas complex that is a complement to the Batangas situation, 3,000 MW capacity in Batangas, that justifies a terminal,” Pangilinan said.
He said Meralco PowerGen did not relay the conversion of the facility with other RP Energy stakeholders as “we’re still doing our studies”.
“We need to know whether that Subic plant is a go or no go, whatever fuel source we eventually adopt,” he said.
RP Energy is waiting for approval of its PSA with Meralco that is pending with the Energy Regulatory Commission.
RP Energy signed a PSA with Meralco for a contracted capacity of 225 MW within a 20-year term on April 20, 2016. The PSA was filed for approval on April 29, 2016. Public hearings were subsequently held and were concluded on Jan. 6, 2017, but the application has yet to be approved.