LOPEZ-LED energy company First Gen Corp. said its unit’s liquefied natural gas (LNG) terminal is on track for completion by the first quarter of 2023, with the possibility of making the first gas delivery after July, a company official said last week.
“I think the progress is good. It should actually be completed by the end of March or positively before,” Jonathan C. Russell, executive vice president and chief commercial officer of First Gen, told reporters on Friday.
In a presentation during the Norway-Philippines Maritime and Energy Conference on Friday, he showed a video on the status of the project, which First Gen’s subsidiary FGEN LNG Corp. intends to complete early next year.
“It’s looking substantially complete now. We really need to get into the control systems, which were the things that were delayed because some of those were coming from China, which was affected by very severe lockdown,” Mr. Russel said.
In its disclosure last month, First Gen said Norwegian firm BW LNG, which is a floating gas infrastructure developer, will provide LNG storage and regasification services to First Gen’s existing and planned gas-fired power plants and third-party terminal users.
Last Friday, Mr. Russell has given his assurance that by 2023, the LNG unit will run and start its operations.
“For the first year of operations we will be looking probably to consume up to half a million tons of LNG,” he said, “and possibly a million tons for the second year that could be adjusted up if the demand requires it.”
Yngvil Asheim, chief executive officer of BW LNG, said the company does not expect any delay in its commitment.
“The vessel is essentially ready to go. She needs going for a few and final modifications for the terminal. That is already well-planned, but she is ready to go in whenever the terminal is ready,” she said.
Mr. Russel said: “We’re in discussions with gas or LNG suppliers right now. I can’t say too much because those negotiations are ongoing.”
“The first delivery of LNG won’t happen until after July,” he said, adding that the month is the schedule for bringing in the floating storage and regasification unit.
According to a report from the Department of Energy (DoE), FGEN LNG’s terminal has a total capacity of 5.26 million tons per annum (MTPA) and an estimated construction cost of P13 billion.
Further, the DoE’s Natural Gas Development Plan showed that LNG terminal projects in the country have an overall investment of P69.23 billion and a potential capacity that is projected to reach 24.6 MTPA by 2040.
The DoE said that 20% of the Philippines’ total power requirements, together with 27% of the Luzon grid, is provided by the Malampaya gas field. However, the Malampaya concession will expire in 2024, with its supply expected to reduce starting this year.
LNG projects in the country are concentrated in Luzon, which has the highest demand for natural gas, the DoE said. — Ashley Erika O. Jose