By Myrna M. Velasco

The Department of Energy (DOE) has announced to the media that the joint venture of businessman Dennis Uy and China National Offshore Oil Corporation (CNOOC) is now the likely winner and racing ahead to be given the notice to proceed (NTP) to build the country’s liquefied natural gas (LNG) import facility.

Energy Undersecretary Donato D. Marcos told reporters that the tandem under its corporate vehicle Tanglawan Philippines LNG, Inc. will be investing US$1 billion for the planned 5.0 million tons per annum (mtpa) LNG onshore terminal to be located in Batangas.

That will be integrated with a power plant project – of 1,000 to 2,000-megawatt capacity – that will then serve as the LNG terminal’s captive market – and such shall require additional investment of US$1.0 billion.

The prospective sites, according to the energy official, are the previous refinery location of Chevron (Caltex) in San Pascual, Batangas or a former project site of AG&P which is along Anilao in Batangas.

“They (Uy-CNOOC group) identified their market with a power plant,” Marcos emphasized, adding that the scale of the power plant will be from 1,000MW to less than 2,000MW.

It has to be recalled that Uy’s other company Dennison Holdings had previously given Manuel Pangilinan’s group the preferential right to join them in the planned LNG ventures.

Pangilinan’s entry into the partnership is seen ideal because its power distribution Manila Electric Company (Meralco) will assure them of a market.

Marcos similarly noted that state-run Philippine National Oil Company (PNOC) already slowed down on its search for a partner – and has in fact suspended its pre-eligibility conference originally slated this December 4.

“PNOC deferred its process. It will just have to watch out who will win (as declared by the DOE), then they will just invest. Whoever wins, their objective is to sell their banked gas, so they don’t see the need to compete,” Marcos stressed.

The energy official further noted that Tanglawan is already the likely winner “because it is the most aggressive,” while the others with investment proposals are reportedly trailing.

Marcos added “there could only be one terminal in the country,” and that the DOE will not issue a permit for an own-use LNG facility – meaning, with Tanglawan now being the highly probable investor, all gas-fired power facilities will already need to draw LNG supply from it.

“We will not be issuing own-use permit, we will be issuing third party access permit,” he said, emphasizing that other plants could source supply from Tanglawan’s LNG terminal through milk-run distribution or other means of logistical access.