Philippines: Cusi wants to convert Malaya Thermal Power Plant into LNG plant

Philippines: Cusi wants to convert Malaya Thermal Power Plant into LNG plant

Energy Secretary Alfonso Cusi wants to convert the 650-megawatt (MW) Malaya
Thermal Power Plant (TPP) in Rizal into a liquefied natural gas (LNG)
facility as part of plans to ensure the country with reliable power supply
in the future.

"Part of the condition is to convert it into LNG plant.so we won't lose
capacity of around 600 MW," he said.

The plant's conversion would allow the country to have a cleaner, more
efficient and more reliable power plant, the Energy chief said.

"From diesel, which is an inefficient and expensive power source. what we
want is the country will still have 600 MW when we convert it into cleaner
power and which we can use as a baseload power. As it is, the plant runs on
diesel oil, which is only for peaking," Cusi said.

However, converting the diesel power plant into an LNG plant should still be
studied since the bidding process for the power facility has already
started, he said.

Currently, the Malaya TPP is among the state-owned power plants scheduled to
be privatized by the Power Sector Assets and Liabilities Management Corp.
(PSALM) this year.

PSALM, the entity created by the Electric Power Industry Reform Act (EPIRA)
to privatize government-owned power assets, has set the auction on March 8.
The asset will be sold on an "as is, where is" basis.

So far, four power companies have expressed interest in the sale of the
Malaya TPP namely APT Global Inc., Phinma Energy Corp., Riverbend
Consolidated Mining Corp. and AC Energy Holdings Inc.

Cusi said it would be better if PSALM would re-bid the Malaya TPP to include
the conversion to an LNG plant in the transaction documents.

"That has to be really looked at," he said. "If we need to re-bid for that
reason, then it would be better if we re-bid it."

Meanwhile, the Energy chief is also looking at rehabilitating the
982-megawatt Agus-Pulangi hydroelectric power plants (HEPP) in Mindanao
before selling the facilities, especially with an oversupply scenario
looming in the region by 2018.

"Having more than enough time in Mindanao, it is an opportune time to
rehabilitate the plants. After that, we can privatize it. We don't like that
if it would not be run given its current situation," Cusi said.

Earlier, Finance Secretary Carlos Dominguez, who chairs PSALM, said
rehabilitating the Agus-Pulangi HEPP is the top priority before undertaking
any privatization process for the facility.

Currently, the Agus-Pulangi HEPP can only supply 40 percent of its total
nameplate capacity to the Mindanao grid. However, it is considered as the
cheapest power source in Mindanao, with capacity being sold at around P2.70
per kilowatt-hour.

PSALM is undertaking a study with International Finance Corp. (IFC) to
determine the best way to privatize the Mindanao power asset.

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Link to Original Article:
http://www.philstar.com/business/2017/02/27/1676008/cusi-wants-convert-malay
a-thermal-power-plant-lng-plant

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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com