Japan’s Marubeni offers to put up facility in Batangas, Philippines

Japanese firm Marubeni Corp. has offered to put up a 200-megawatt (MW) power plant fueled by natural gas in Batangas, according to Philippine the Energy chief.

The plant, which will be installed at no cost to the government, will be transferred to the province “so they will just do the pipe laying. But their condition is to have a good price of gas from Malampaya’s banked gas,” Energy Secretary Carlos Jericho L. Petilla told reporters.However, the banked gas stored within the Malampaya reservoir would have to be auctioned off, Mr. Petilla said.

“But I want to know the price that they are looking at. After that I can refer them to Shell, because Shell has extra gas that can power the same plant size which is 200 MW,” he added.

He was referring to Shell Philippines Exploration B.V. (SPEX)–a member of the Malampaya consortium, which operates the Malampaya gas field offshore Palawan.

Power from Marubeni’s proposed plant was originally intended to boost supply for the summer but the company may find it difficult to secure natural gas since Shell’s extra reserves could not be extracted by that time.The Malampaya gas field will undergo a scheduled maintenance shutdown from March 15 to April 14 to give way for activities that would allow the consortium to continue producing natural gas from the resource area.

“The problem is Malampaya consortium said that after April 15, they can’t produce the extra gas for Marubeni,” Mr. Petilla said. “They can only do that once the pressure at the gas field normalizes, which is expected towards the end of next year,” he explained.

While Marubeni’s offer still stands, Mr. Petilla said he is waiting if the foreign company is willing to utilize diesel first so that the 200-MW plant could run by summer.

The massive stock of natural gas stored within the Malampaya reservoir can fuel another 400-MW power plant.

The banked gas — owned by Philippine National Oil Co. — was contracted by the government as reserved supply for future use.It was supposedly allotted for the 1,200-MW Ilijan natural gas plant in Batangas once the gas from the Malampaya platform runs out, as projected, in 2024.

But given the pressing concern on supply security, the government now plans to just auction this off to the private sector so that it could be used for immediate power generation investments.

SPEX said earlier this month that the government committed to complete the process within one year.

(businessworld online)