The LNG terminal project of Lopez-owned First Gen Corporation and its partner Tokyo Gas was among the 30 business deals personally cited by President Ferdinand R. Marcos Jr during his recent five-day official visit to Japan.
President Marcos last Friday lauded First Gen’s partnership with Tokyo for the terminal facility, which is worth over $ 1billion, noting its critical role in ensuring energy security in the country, especially as output from the Malampaya gas field is expected to start declining.
In a statement, First Gen said that Marcos and his delegation witnessed the signing of letters of intent on investment or agreements of cooperation between the Philippines and Japan governments and various companies during his Japan trip.
Trade Secretary Alfred Pascual said most of the documents signed during Marcos’ visit signified projects that were “ready to go,” although they vary in degrees of readiness as some initiatives were already agreed upon, while others expressed intent to implement.
Unlike the other pledges, the LNG project of First Gen and Tokyo Gas is already built and is expected to start commercial operations in Batangas by June.
The operation of the LNG project can’t come soon enough as the Malampaya gas field is expected to dry up by 2027.
Marcos met with Tokyo Gas officials, led by its president and CEO Takashi Uchida, and First Gen chairman and CEO Federico “Piki” Lopez on Friday, where he noted LNGs significant share in the country’s energy mix since 2017.
“And so, we are encouraged that in view of Tokyo Gas that it is worth the investment then we feel that we are going down the right path for our country’s energy mix and we are grateful for that vote of confidence that you have shown by your investment in the future of the Philippine economy, the future especially of our energy supply from liquefied natural gas (LNG),” Marcos said.
“And this was even before it was decided that LNG would create this large role in our energy mix because we are very much talking about the mix between renewables and traditional at the time. But now we are here now and certainly that is the most critical part of our plans for the future,” Marcos said.
Marcos noted that the country would have to wait to reap the benefits of renewable energy because putting up the infrastructure for such projects would take time.
“We are generally speaking [of] 6, 7 years so even if we begin tomorrow, we still have to work 6, 7 years and the question is what do we do in the meantime? We are examining the possibility… of course take more traditional wind and solar power, geothermal, all of these. But it will take time to come into play because the infrastructure has to be put in place,” the President said.
“That’s why we are doing all we can to find ways to further encourage extraction of LNG,” he said.
The Lopez firm forged an 80-20 partnership with Tokyo Gas for the LNG project. Under the deal, Tokyo Gas has 20% participating interest and provides support in development, construction, operations and maintenance.
The project, located inside First Gen’s existing Batangas energy complex, consists of the modification of the existing jetty for multi-use and adding gas receiving facilities, which allows the firm to bring in a floating storage and regasification unit (FSRU) on an interim basis and introduce LNG to the Philippines.
Tokyo Gas, headquartered in Tokyo, Japan is a leading LNG player with 130 years of experience and more than 50 years of experience in the LNG business.
Tokyo Gas is one of the largest purchasers of LNG in the world with an annual volume of 14 mtpa (million tonnes per annum). It has over 63,000 kilometers of gas pipelines serving more than 11 million customers.
LNG produces 40% less carbon dioxide than coal and 30% less than oil, which makes it the cleanest of the fossil fuels. It does not emit soot, dust or particulates and produces insignificant amounts of sulphur dioxide, mercury and other compounds considered harmful to the earth’s atmosphere.
CurrentPH News Service