Tanglawan eyes more time on LNG project

Tanglawan Philippine LNG Inc., the joint venture of Phoenix Petroleum Philippines and China National Offshore Oil Corp., will likely seek an extension of the notice to proceed for its $2-billion liquefied natural gas project, Energy Secretary Alfonso Cusi said Tuesday.

Cusi said while Tanglawan had not filed a formal request for an extension, the agency would give the joint venture a chance to explain the delay in the compliance with the requirements.

“What I heard is they will ask for an extension… I still have to receive [it],” Cusi said. Tangalawan’s notice to proceed for its integrated LNG hub project expired on June 22.

Energy Assistant Secretary Leonido Pulido said Tanglawan could file for an extension, “but the committee has to decide if they have substantially complied with their plans before granting them an extension.” 

Tanglawan is building a regasification terminal in Batangas costing $686 million and a power plant component that is estimated to cost $1.3 billion.

The department earlier gave Tanglawan six months from the issuance of the NTP in December 2018 to comply with the conditions of the NTP.

Tanglawan is supposed to break ground for the LNG regasification and receiving terminal with a capacity of 2.2 metric tons per annum this year.  Commercial operations were expected to start by 2023. 

“We will wait for their justification. We have to hear that.  We cannot just pass judgment…Let’s see what are the reasons behind,” Cusi said.

Cusi earlier said Tanglawan had to comply with the requirements for the grant of NTP.  Requirements for the next six months include permits from other government agencies, environmental compliance certificate, LGU endorsement, financial closing, among others.

“They have to do all the submissions already.  They have six months.  The ball is in their hands,” Cusi said.

State-owned Philippine National Oil Co. is also supposed to take a stake in the project.

“There is a provision [in the NTP] that there are still papers still to be submitted.  One of the big milestones there is their seriousness to put up a 1,100-megawatt power plant of gas,” Energy Undersecretary Donato Marcos said earlier.

Marcos said Tanglawan needed to look for an offtaker of the power plant.

“They have to coordinate [with Manila Electric Co.). Otherwise, the market or the commercial viability of the project will not push through,” he said.

The government has been pushing for the development of the LNG hub to secure the country’s power requirements in preparation for the eventual depletion of the Malampaya gas project in northwest Palawan by 2024.