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PNOC, Shell eye possible gas tie-up

The Shell Group of Companies in the Philippines has initiated talks with state-owned Philippine National Oil Co. for a possible partnership in the government’s planned liquefied natural gas project in Batangas.

“Shell expressed interest in (our) LNG project but no formal offer. They could be a good partner because they are already our partner in Malampaya,” said PNOC president Ruben Lista.

Shell Philippines Exploration B.V operates the Malampaya gas project in northwest Palawan with a 45 percent while PNOC unit PNOC Exploration Corp. holds a 10 percent interest. Chevron Malampaya owns the balance of 45 percent in service contract 38 consortium.

PNOC, meanwhile, is putting up an LNG integrated facility and a 200-megawatt power plant in Batangas.

Shell earlier announced that it also planned to establish a floating re-gasification facility in Batangas.

Shell officials want the government to come out with an LNG policy to guide them in their final investment decision, adding the group was looking for possible partners.

“We don’t want to compete with anybody just initiating the project. We don’t even have to be majority. Somebody has to have the storage facility for LNG. And we are putting up the plant for (economic zones) and for the poorest of the poor,” Lista said.

Lista said that if PNOC could use the banked gas from Malampaya or secure the fuel from other sources, it would bring down the cost of electricity.

Lista earlier said PNOC was keen on developing its 19.4-hectare Energy Supply Base property in Mabini, Batangas and transform it into an integrated LNG facility.

Lista said PNOC could bring the LNG facility into operations within a 24-month period from groundbreaking.

“We will put up some more LNG storage facility there... because it’s faster and they do not need to develop any other infrastructure,” Lista said, adding part of the property or around 4.1 hectares was currently leased to Petron Corp.

Topics: Shell Group of Companies , Philippine National Oil Co. , PNOC , partnership , liquefied natural gas
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