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First Gen’s project granted ‘national significance’ status

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By Myrna M. Velasco

The US$1.0-billion liquefied natural gas (LNG) import terminal project of First Gen Corporation and its partner Tokyo Gas Co. Ltd. has been granted “national significance” status in an approval set forth by the Energy Investment Coordinating Council (EICC) of the Department of Energy.

First Gen logo

The certificate of energy project of national significance (CEPNS) has been formally awarded to the FGEN Batangas LNG terminal project on August 5 this year, within the purview of Executive Order No. 30 that was issued by President Rodrigo Duterte in 2017.

With CEPNS stature, the FGEN LNG venture would be able to avail of streamlined process of project approvals – primarily with government agencies that are in coordination with the energy department’s EICC.

In a statement to the media, the Lopez group emphasized that the LNG import terminal’s EPNS declaration had been “on the basis that the project will require the development of significant infrastructure and capital investment involving complex technical processes and engineering designs that will result in a substantial positive impact on the environment.”

The proposed LNG import facility is targeted to reach final investment decision (FID) toward the end of this year to early part of 2020 – then construction will follow soon after.

The project-sponsor firm is still at the process of cornering additional partners for the venture – on top of the 20 percent equity that Japanese firm Tokyo Gas had already cornered in FGEN LNG, which is the corporate vehicle of the proposed gas import terminal investment.

As noted by Jonathan Russell, executive vice president and chief commercial officer of First Gen, the project is “crucial to ensure the continued operations of the 3.2-gigawatt existing natural gas-fired plants given the expected reduction in gas supply from the Malampaya field up to the expiration of the contracts by 2024.”

He indicated that with the LNG import facility installation, this could guarantee that capacity addition for gas-underpinned generation can be brought to commercial fruition – which may prove highly relevant for the country as it targets expanded integration of renewable energy (RE) into the country’s power mix.

RE and gas technologies in an energy mix are considered the “match made in heaven,” because flexible gas is the one that can manage the intermittency of RE technologies like wind and solar.

On capacity additions, First Gen itself is eyeing to take off from project blueprint up to 1,200 megawatt of greenfield gas-fired power plant to shore up power supply that could satiate the country’s incessantly growing electricity demand.

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