LNG projects suffer delays, DOE says – Manila Bulletin

Completion of construction of several offshore liquefied natural gas (LNG) import terminal projects in the country faces slight delays due to Covid-related mobility restrictions, according to a situation report released by the ministry Energy.

The DOE estimated that the operations of the LNG installation initiated for the second quarter of 2022 had slipped in the third quarter; while those who plan to be on commercial release by the third quarter have already moved to the fourth quarter.

In particular, the department noted that the regasification floating storage unit (FSRU) business of US company Excelerate Energy LP is postponing the commercial operating target to the third quarter of 2022 – compared to its initial schedule of the second. quarter 2022.

The agency said it had authorized at least two extensions to Excelerate Energy’s Notification of Procedure (NTP) license, or the license issued by the DOE for LNG investments in the country.

“The DOE has granted two extensions of NTP – the first, valid for six months, as permitted by the Philippine downstream natural gas regulations, was published on May 27, 2020,” the department said.

The DOE added that “the second, due to a force majeure event caused by the Covid-19 pandemic, was issued on December 16, 2020 and was valid for three months.”

The energy agency then pointed out that based on these NTP extension requests, the estimated commercial operation date (COD) of Excelerate Energy’s LNG import facility would drift in the third quarter of next year.

“The department is evaluating Excelerate’s building permit application, while the company obtains the necessary permits from other relevant government agencies and financial close before construction,” the DOE said.

Another FSRU LNG project that will hover slightly for commercial completion is that of First Gen Corporation, which the company said it will spend in the fourth quarter of 2022, compared to the previous third quarter liquidation date.

Atlantic Gulf & Pacific Company (AG&P) LNG Project Still Maintains Target Date for Completion by Q2 2022; but the DOE indicated that the sponsoring company had not yet finalized its application for a permit to build, extend, rehabilitate and modify (PCERM) and that there was already a first demonstration that it would seek a extension of its implementation deadline.

Other gas import facilities closely monitored by the DOE over the development of their projects are those of Shell Energy Philippines, Vires Energy Corporation, and Energy World Gas Operations Philippines Inc.

The crucial timeframe for the country in terms of its additional gas supply needs will be the second quarter of next year – as this will be the period when the gas purchase and purchase agreement (GSPA) of the power plant in the 1,200 megawatt Ilijan gas with the Malampaya field operator will expire.

Energy Secretary Alfonso G. Cusi said he had encouraged the development of LNG import facilities “in anticipation of the eventual depletion of the Malampaya deep water power generation project, which provides about 20% of the country’s energy needs ”.

As current developments show, the Malampaya gas production facility may already face a faster depletion rate from next year. Therefore, importing LNG will be the next best resort for the country’s gas-fired power plants.



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