STANDARD: First Gen readies LNG hub
May 14, 2015
First Gen Corp. will choose its joint venture partner for the -billion liquefied natural gas regasification terminal in Batangas this year, in time for the start of the construction in 2016, company executives said Wednesday.
First Gen president Francis Giles Puno told reporters following the stockholders meeting that the company was preparing for the tendering process for the construction. He said the front-end engineering design was on the second stage of revision.
“What we will do is to conduct a tendering process based on that, we will decide. This year, we also announce partners in LNG terminal,” Puno said.
He said the LNG terminal would allow First Gen to import LNG and “address the depletion of the Malampaya gas 10 years from now.”
First Gen owns the 1,000-MW Santa Rita and 500-MW San Lorenzo power plants in Batangas. The company is also embarking on natural gas power plant expansion.
“The availability of natural gas has benefitted key industries in other markets. We see the supply to power and industrial users as the growth of future market demand for LNG,” Puno said.
First Gen tapped Tractebel Engineering of France for the detailed design of the LNG terminal.
“The Feed [front-end engineering design] is still undergoing fine tuning but when you look at the Feed study, you can now build. Next thing to do is conduct the tender process. We have shortlisted potential contractors that are very capable of building a world class facility, international players. They will be able to deliver the terminal hopefully on time,” he said.
Puno said the company planned to award the contract next year in time for the start of construction in the second half of 2016 or 2017.
“This year we will also announce partners in LNG. We’re looking at offering 50 percent to other partners. It’s a combination of Filipino and foreign partners. The foreign partners will bring expertise in operating the LNG facilities,” he said.
Puno said the company expected net income to remain flat this year after jumping 64 percent to USD75.1 million in 2014.
“If we want to grow business you have to invest, so it reduces your or effective net income. It will pay off once we start commercial operations, Avion and San Gabriel, that’s 500 MW,” he said.