First Gen unit to begin work on Batangas LNG terminal

FGEN LNG Corp., a wholly-owned subsidiary of First Gen Corp., will start the construction of an interim offshore liquefied natural gas terminal at the First Gen complex in Batangas City in March, a top executive said Thursday.

“I’m pleased to tell you that the project has moved past the planning stage and it’s now moving ahead. We recently issued notice to proceed to our EPC [engineering, procurement and construction] contractor McConnell Dowell and the engineering is underway with construction expected to start by March of this year,” First Gen executive vice president and chief commercial officer Jonathan Russell said during the virtual Philippine Energy Transition Forum.

FGEN LNG earlier selected McConell Dowell as the preferred tenderer for the EPC contract of the interim LNG terminal project.

The offshore LNG terminal project will allow FGEN LNG to bring in a floating storage regasification unit on an interim basis and thus accelerate its ability to introduce LNG to the Philippines as early as third quarter of 2022 to serve the natural gas requirements of existing and future gas-fired power plants of third parties and FGEN LNG affiliates.

Russel said the tender process for the selection of the FRSU was ongoing. The three FSRU bidders are BW Gas Limited, Dynagas Ltd. and Hoegh LNG Asia Pte. Ltd.

An FSRU is an LNG carrier that is capable of storing LNG and which has an onboard regasification plant capable of returning LNG into a gaseous state and then supplying it directly into the gas network.

Russell said First Gen would construct the interim offshore LNG terminal by modifying the existing liquid fuel facilities built several years ago. “That will accommodate an FSRU or floating storage and regasification unit that we will lease to receive, store and regasify LNG,” he said.

The company is pioneering the development of an LNG terminal that will introduce reliable, flexible and cost-competitive LNG to the Philippines.

“LNG will enable our own and existing gas power plants to continue to operate and eventually they would replace the declining indigenous gas reserves,” Russel said.

He said the race for LNG development was ongoing given the expiring contract of the Malampaya gas project in northwest Palawan and its declining reserves.

The Department of Energy granted FGEN LNG the permit to construct, expand rehabilitate and modify the LNG terminal in Batangas in September last year.

First Gen also signed a joint cooperation agreement with Tokyo Gas Co. Ltd. for the joint development of the project.

First Gen has 3,492 megawatts of installed capacity in its portfolio power projects of clean and indigenous fuels such as natural gas, geothermal energy from steam, hydro-electric, wind and solar power which accounts for 21 percent of the country’s gross generation.

Topics: FGEN LNG Corp. , First Gen Corp. , liquefied natural gas , Batangas LNG terminal
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