Philippines: LNG power plant woes in Quezon unresolved

Philippines: LNG power plant woes in Quezon unresolved

The Energy Department advised Energy World Corp. to seek the help of the
Energy Regulatory Commission to address the company's transmission line
issues, an official said Tuesday.

Energy World, a unit of Energy World Corp. of Australia, is putting up a
650-megawatt liquefied natural gas plant and terminal in Pagbilao, Quezon
province but has difficulty in getting a connection to the Luzon grid.

"It encountered problems so we advised them why they don't consider going
already to the ERC... It's not only EWC, it also involves NGCP (National
Grid Corp. of the Philippines), TransCo (National Transmission Corp.) and it
also has issues with energy players in the area like Pagbilao," Energy
Undersecretary Felix William Fuentebella said.

National Grid operates and maintains the country's transmission network
while state-owned TransCo owns the transmission assets.

Energy World's power plant is situated beside TeaM Energy Philippines'
735-MW Pagbilao coal-fired power plant.

TeaM Energy, along with Aboitiz Group, is building the Pagbilao 3 expansion
which will add 420 MW to the grid by late this year.

Energy World wants to use the existing transmission facility of TeaM Energy
to connect to the Luzon grid, a faster option instead of building a new
connection facility. Other power generators, however, will also use the line
to deliver power from the Pagbilao expansion.

"There are questions that should be answered technically and it can be
through a petition filed before the ERC," Fuentebella said.

Fuentebella said by formalizing its concerns to the ERC, Energy World could
speed up the plant's project development.

Fuentebella said the issues facing Energy World include linking the plant to
the transmission line, another 14-kilometer line with right-of-way problems
and the possibility of building a submarine cable to ensure delivery of the
plant's capacity.

"The plant is around 45 percent complete...," Fuentebella said.

Energy World has been seeking government assistance to enable it to connect
the plant to the Luzon grid since last year and has not obtained a solution
to date

The company in June last year received P1.5 billion funds in for the
Pagbilao LNG hub terminal project.

The company's omnibus loan and security agreement provides an additional
P2-billion facility for the project.

Standard Chartered Bank acted as issue manager and book runner, while Land
Bank of the Philippines was the lead arranger of the loan.

Energy undersecretary Mylene Capongcol earlier said Energy World's planned
floating storage re-gasification unit, which was supposed to be the first
LNG facility in the country, remained to be completed.

Reynaldo Umali, chairman of the House committee on energy, also said a team
from the committee visited the company's project and learned about the
interconnection issues hounding the project.

"There's a problem in the interconnection. But the plant itself can produce
anytime. It's ready for commissioning, except for the interconnection
concerns," Umali said.

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Link to Original Article:
http://thestandard.com.ph/business/power-technology/245127/lng-power-plant-w
oes-in-quezon-unresolved.html

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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com