MANILA, Philippines — US-based Excelerate Energy and its local partner Topline Energy and Power Development Corp. plan to spend around P11.1 billion or $230 million for the construction of an open-access liquefied natural gas (LNG) import terminal in Batangas.
The project, called Filipinas LNG Gateway, would be funded by both companies, said Topline Energy executive vice president Michael Acebedo Lopez, adding that majority of the cost or around 60 to 70 percent would be shouldered by Excelerate.
“Since receiving a notice-to-proceed from the Department of Energy (DOE) in late 2019, Excelerate has worked diligently to develop Filipinas LNG so that the energy markets can be prepared for the next chapter after Malampaya,” said Ramon Wangdi, president of Luzon LNG Terminal Inc., Excelerate’s local subsidiary.
The Filipinas LNG Gateway project will have an import capacity of about five million tons of LNG per annum and will be able to supply fuel for up to 4,000 megawatts (MW) of baseload power generation, which will allow it to service multiple power plant customers in Luzon.
The project will provide access to all power plants in the Luzon that are using natural gas as fuel.
Wangdi said the facility is targeted to come online as early as the second quarter of 2022.
Excelerate said Filipinas LNG follows a third party access (TPA) model whereby LNG import capacity is marketed to multiple gas users in the region on an open and transparent basis. This is the opposite of the ‘own use’ model where separate LNG terminals are being built for each independent power plant.
“One distinguishing feature of Filipinas LNG’s TPA model is that it allows all gas users in the region unfettered access to the global LNG marketplace by signing up for regas capacity at the terminal,”Wangdi said.
The company said the open access model, which is successfully adopted in major LNG markets around the world, allows for substantial economies of scale, the cost savings for which are ultimately enjoyed by the electricity consumers of Luzon.
The LNG terminal will utilize Excelerate’s state-of-the-art offshore floating storage regasification unit (FSRU) technology, specifically designed to perform in extreme weather conditions like those of the Philippines.
The technology has been proven at Excelerate’s operations in the US within the Gulf of Mexico and North Atlantic, Israel, and most recently, the Bay of Bengal.
“Reliability is critical in fueling power plants, and when it comes to LNG, there is no substitute for experience,”Wangdi said.