First Gen Corp. is pursuing discussions with Prime Infrastructure Capital Inc. (Prime Infra) for the proposed gas aggregation framework with the former’s liquefied natural gas (LNG) import terminal serving as a main component.
Prime Infra’s lease of the company’s LNG import and regasification terminal being developed in Batangas City is part of the gas aggregation proposal.
In a disclosure to the Philippine Stock Exchange, First Gen said the gas aggregation framework being discussed with Prime Infra was meant to “make it possible to blend currently declining volumes of indigenous Malampaya gas with imported LNG.”
First Gen said the framework is expected to provide the least cost solution for consumers while also enhancing the country’s energy security and bringing in a competitive market for power generation.
The company added the framework would complement ongoing commercial development of “new indigenous natural gas fields.”
“All of these activities are in response to the national government’s urgent call for significant investments to ensure national competitiveness,” First Gen said in its disclosure.
The proposed framework would also tap into Malampaya consortium’s expertise in the natural gas market that would lead to reliable and lowest cost supply of clean gas to the country’s power plants.
First Gen runs four natural gas-fired power plants with a combined capacity of 2,017 megawatts which have been getting fuel supply from Malampaya.
Guillaume Lucci, Prime Infra president and chief executive officer, said in a statement the gas aggregator framework “establishes a resilient and efficient natural gas supply chain.”
Lucci added the proposal “would ensure a stable and sustainable baseload power supply.”
Meanwhile, First Gen also awarded a contract to Shell Eastern LNG last Friday for its first LNG cargo following a successful international tender.
First Gen said Shell Eastern LNG will supply one LNG cargo of approximately 154,500 cubic meters within the required delivery window of August 1 to September 30 this year.
The LNG cargo to be provided by Shell Eastern LNG will be delivered by an LNG carrier which will facilitate the gassing-up and cooling-down of the BW Batangas floating storage regasification unit and transfer the LNG cargo into the storage tanks on board the BW Batangas at Subic Bay.
The BW Batangas will then return to the FGen LNG terminal in Batangas to complete commissioning activities with the LNG to be purchased by First Gen to subsequently be utilized by its existing natural gas-fired power plants.
First Gen added it successfully moored and secured the BW Batangas last Saturday as the vessel is expected to remain in Batangas until it is required to depart for Subic Bay to collect the first LNG cargo that will be delivered by Shell Eastern LNG. -Jed Macapagal
