Tokyo Gas, First Gen Ink Philippines LNG Terminal Pact
Japan’s Tokyo Gas has signed a joint cooperation agreement with Manila-listed First Gen Corporation for development of an LNG import terminal in the Philippines, Tokyo Gas said on October 7.
The two companies entered into a joint development agreement in December 2018, and have been building a provisional offshore LNG terminal in Batangas City. With the latest agreement, the parties will move ahead with the construction of a floating storage and regasification unit (FSRU), with the aim of introducing LNG to the Philippines as early as in the second half of 2022, Tokyo Gas said.
Under the terms of the agreement, the two companies will jointly construct, operate and maintain the provisional terminal. They will convert its existing jetty into a multi-purpose jetty and construct an onshore gas receiving facility. Tokyo Gas will take a 20% interest in the project. The department of energy of the Philippines granted a permit to construct to the terminal last month.
Fgen LNG, a unit of First Gen, is preparing to issue a binding invitation to tender for an FSRU upon completion of its ongoing non-binding process. BW Gas, GasLog LNG Services, and Hoegh LNG, have expressed interest in providing the FSRU.
First Gen has about 2 GW generating capacity from four operating gas assets – the 1-GW Santa Rita plant, the 500-MW San Lorenzo plant, the 414-MW San Gabriel plant and the 97-MW Avion plant – all of which depend on Malampaya's gas, whose gas sales contract expires in 2024. They are all at Batangas City.
Also needing gas supply is the 1.2-GW Ilijan gas-fired power plant, operated by Korea Electric Power Corporation but due to be turned over to Philippine conglomerate San Miguel Corporation in July 2022. The facility’s gas sales and purchase agreement is set to expire early that year.