Batangas Clean Energy (BCE), a liquefied natural gas (LNG) joint venture between tobacco and alcohol magnate Lucio Tan and American investors, has failed to secure a permit to construct, expand, rehabilitate, and modify (PCERM) from the Department of Energy (DOE).
Based on a BusinessWorld report, BCE was unable to secure financing for its Php82.5-billion LNG power plant project, citing the absence of an off-taker. Though it is not ready to submit a PCERM just yet, BCE President Yari Miralao said that the company remains committed to developing its LNG venture.
According to Miralao, an off-take agreement guarantees that banks extending loans will get paid. Off-take agreements usually involve the advance buying or selling of a producer or importer’s goods.
On Friday, the DOE released a list of six firms with existing permits for LNG projects. BCE was not included in the list. The DOE-Oil Industry Management Bureau (DOE-OIMB) later said that the firm’s NTP already expired. BCE’s NTP was approved in October 2020.
Based on a DOE circular issued in 2017, an NTP is released first before that of a PCERM. Upon the NTP’s release, the proponent is given six months to submit all requirements. Extensions may be granted if necessary.
Securing a PCERM, meanwhile, requires the submission of “proof of financial closing,” and other documents.
Given the development, Miralao said BCE had received an assurance from DOE-OIMB that it can apply for a new NTP or PCERM “without prejudice.”
As for the DOE list, two firms were granted permits to construct, namely: First Gen Corporation and Energy World Gas Operations Philippines. Meanwhile, US-based Excelerate Energy L.P., Atlantic Gulf & Pacific, Shell Energy Philippines, and Vires Energy Corporation’s NTPs are currently valid.