MGen looking at shift to LNG

MERALCO PowerGen Corporation (MGen), the power generating arm of the Manila Electric Company (MERALCO), is seriously considering the use of liquefied natural gas (LNG) for its power plants instead of the previously planned coal-fired facilities.

MERALCO Chairman Manny V. Pangilinan believes that the power giant should get into the gas business, while emphasizing that there are at least three locations being planned for its LNG venture.

Among the sites being considered are Atimonan, Quezon, where a 1,200-megawatt coal plant project was to be built. Pangilinan said that if MERALCO would have another competitive selection process (CSP) this year, the proposed plant can be converted into an LNG facility. The Atimonan plant is owned by MGen subsidiary Atimonan One Energy, which participated in MERALCO’s recently-concluded CSP, but was outbidded by San Miguel Corporation.

Pangilinan is also considering Batangas, which hosts five LNG power plants fueled by the Malampaya gas field in Palawan. The site, he said, can be particularly located near any of the said plants.

Should the Batangas site prosper, the strategic plan is to eventually link it with the prospective Service Contract 72 development at the Recto Bank in the West Philippine Sea, which is seen to yield potential for commercial gas discovery, or if the MVP Group successfully acquires Shell Philippines Exploration’s 45% stake in Malampaya.

Another alternative would be to build a new gas facility in Atimonan or to take on a greenfield development in the western coast of the Zambales-Bataan area, where the Subic Bay Freeport is located.

Metro Pacific Investments Corporation, which owns MERALCO, recently acquired Subic-based Philippine Coastal Storage and Pipeline Corporation, which operates the country’s largest oil import terminal.

Pangilinan said that the plans have yet to be examined, but the process has to be sped up, especially if a new CSP happens indeed this year.

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