Energy department ‘constrained to cancel’ project led by Dennis Uy
By Angelica Y. Yang
THE Energy department has identified Vires Energy Corp. and Atlantic Gulf and Pacific Co. (AG&P) as potential investors in a floating facility for imported gas, as the country prepares for the depletion of its sole supplier of the energy resource.
“Yesterday, we had a pre-application conference with Vires Energy, which plans to bring in an FSRU (floating storage and regasification unit) and also with AG&P, which has… an initial agreement with San Miguel (Corp.). They also intend to bring an FSRU,” Department of Energy (DoE) Assistant Secretary Leonido J. Pulido III told participants of a Senate hearing on Tuesday.
The DoE official made the statement in response to questions from Senator Risa Hontiveros-Baraquel, one of the lawmakers who attended the hearing on Senate Bill No. 1819, which seeks to pass the Midstream Natural Gas Industry Development Act.
Vires is a firm owned by Cagayan de Oro-based listed company A Brown Co., Inc. AG&P, which operates globally, is a Filipino company with manufacturing plants in Batangas.
An FSRU contains an onboard regasification plant, which can turn liquefied natural gas (LNG) back to gas. Natural gas is usually liquefied for ease of transport.
The DoE had earlier issued a permit to construct to Lopez-led First Gen Corp., as well as a notice to proceed to Texas-based Excelerate Energy L.P.
During the hearing, Mr. Pulido also gave an update on the planned $2-billion import terminal led by Tanglawan Philippine LNG, Inc.
“We were constrained to cancel their notice to proceed as, in fact, they essentially withdrew their plans as they were not able to reach financial close,” Mr. Pulido said. “They are no longer pursuing their project.”
He added that the withdrawal was caused by a “commercial issue.” Tanglawan is controlled by Phoenix Petroleum Philippines, Inc., the oil company owned by Davao City businessman Dennis A. Uy.
Tuesday’s hearing was the second day lawmakers heard energy stakeholders’ comments on SB 1819, which aims to regulate the midstream natural gas industry. The industry covers various operations such as aggregation, supply, importation, receipt, unloading, loading, processing, storage, regasification, transmission and transportation of natural gas in original or liquefied form.
The measure was introduced as the reserves in the offshore Malampaya gas-to-power project face imminent depletion in the coming years.
Last week, the DoE said that it expected the private sector to take the lead in building the country’s LNG infrastructure, which included constructing terminals to receive imported fuel.
The department said this in response to Senator Sherwin T. Gatchalian’s previous statement that the government must find ways to encourage private companies to build LNG hubs.
In 2019, the Malampaya project under Service Contract 38 supplied 3,200 megawatts of electricity, accounting for 21.1% of the country’s gross power generation. The DoE projects that its resources will be gone by 2027.
