Source:  Manila Bulletin

MANILA, Philippines — As the propounded regulatory framework for the country’s natural gas industry is being fleshed out, the Department of Energy (DoE) has bared that the number of interested investors for re-gas facilities for liquefied natural gas (LNG) and the supporting pipeline infrastructure have been constantly growing.

Energy Secretary Rene D. Almendras told reporters that about six companies have indicated to join the scheduled auction for pipeline projects; while four to five companies are keenly eyeing to invest on LNG re-gas terminals.

For the pipeline, the energy chief indicated that 5 to 6 foreign firms already advanced interests for the venture. He only dropped hints on the nationalities of the interested parties as Japanese, Italian, Middle Eastern and Thai firms, among others.

For the LNG re-gas terminals, the prospective investors are Japanese, Australian, American and European firms. “An American company came to me earlier … and as I told them, there are already many of you who are interested in putting up LNG re-gas terminals,” the energy chief said.

It was gathered that aside from the facilities being planned for auction by the government under a public-private sector partnership (PPP) setup, some investors are similarly exploring the possibility of forging direct tie-up with local private firms.

The DoE emphasized that the pipelines and LNG re-gas facilities could be offered under a PPP arrangement, but the power component must be held as a purely private sector undertaking in keeping with the provisions of the Electric Power Industry Reform Act.

The energy department is eyeing completion of the feasibility study of the Japan International Cooperation Agency (JICA) on the country’s gas industry around third quarter this year. This will then serve as a guiding framework in the policy that shall be crafted for the sector.

For the project biddings targeted within the year, the preliminary costs quoted by the energy chief had been $1.3 billion for the pipeline and $700 million to $800 million for the regas terminal.

The priority, based on the DoE’s blueprint, would be the auction for the Batangas-Manila gas pipeline; while the first LNG terminal being offered is the one in Batangas to serve the requirements of power facilities which will retrofit as gas-fed generation units.

Mindanao, primarily Davao, is also eyed as site for the other LNG facility which has been initially cornering support from the World Bank.

Published on 18 May 2011, Manila Bulletin