DOE pushes development of liquefied natural gas sector

MANILA, Philippines — The Department of Energy is pushing to strengthen the development of the liquefied natural gas (LNG) sector to help energy security targets even as one proponent drops out from the race to put up LNG terminals in the country.

It is also pursuing collaborations locally and abroad to promote the development of nuclear and hydrogen in the country.

DOE Secretary Alfonso Cusi reiterated his directive to intensify efforts to meet energy security targets, particularly the LNG sector, as the industry seeks to contribute to economic recovery in the new normal.

According to the agency, there are currently six proposed LNG terminal projects, down from the previous seven cleared by the agency.

No longer in the list is Batangas Clean Energy Inc., which is proposing to build LNG storage and regasification terminals.

Sought for comment, the DOE- Oil Industry Management Bureau said Batangas Clean Energy’s notice to proceed (NTP), which has an initial validity of six months, expired and the proponent has not submitted any application for the next permit.

Of the six proposed LNG terminal projects, two have been issued with permits to construct (PTC).

These are the interim floating storage regasification unit (FRSU) and FGEN LNG Corp.’s LNG terminal project, which is estimated to start commercial operations in the third quarter of next year, and the LNG storage and regasification terminal project of Energy World Gas Operations Philippines Inc., which is supposed to start operating in the fourth quarter of next year but is seeking an extension of its PTC for another 24 months.

Meanwhile, four proposed projects have been issued with NTP, subject to further extensions for approval by the DOE.

This includes the FSRU LNG Terminal of Excelerate Energy L.P. set for operations in the third quarter of next year, the floating storage unit and onshore regasification and LNG storage tank project of Atlantic Gulf & Pacific Co. of Manila Inc. targeted to start operating in the second quarter of next year, the FSRU terminal project of Shell Energy Philippines Inc. (SEP) with an estimated commercial operations date (COD) of third quarter next year, and the FSRU terminal of Vires Energy Corp. targeted to operate in the first quarter of 2023.

These four proponents are currently securing the necessary permits from other concerned government agencies and financial closing prior to construction.

In anticipation of the eventual depletion of the Malampaya deep-water gas-to-power project which has been providing about 20 percent of the country’s power needs, Cusi has long been advocating for the optimization of LNG from importing the gas, establishing the necessary infrastructure to help the sector progress from its current infancy stage, and seeing the country develop into a leading LNG hub in Asia.

The contract of the Malampaya project, the country’s largest gas development to-date which powers around 3,457 MW of power plants that provide power supply to the Luzon grid, is set to end in 2024.

Apart from LNG development, Cusi is also promoting to harness the potential of nuclear energy as part of the energy mix, and exploring other sources of energy like hydrogen to meet the country’s growing needs.

“It is high time that the feasibility of safely utilizing nuclear energy to meet our energy requirements be considered,” Cusi said.

The DOE signed a memorandum of agreement with the Presidential Communications Operations Office (PCOO) and Bureau of Communications Services (BCS) to develop a Comprehensive Strategic Communication (StratCom) Plan on Nuclear Energy.

The StratCom plan is envisioned to contain broad-based strategies designed to address stakeholders’ negative perception on the use of nuclear energy for power generation.

The DOE is also looking at a potential collaboration with France after a Paris-based firm expressed interest for partnership.

“Attaining energy security may have been complicated by the current global health crisis. However, the DOE is seeing to it that we will be able to carry on. The department continues to pursue all possible avenues that will help us break free from energy import dependence and provide the energy needs of future generations of Filipinos in a sustainable manner,” Cusi said.