Philippines: First Gen open to 30% stake in planned LNG terminal

Philippines: First Gen open to 30% stake in planned LNG terminal

Lopez-led First Gen Corp. is open to acquiring at least a 30-percent stake
in the government planned liquefied natural gas (LNG) terminal to finally
get the project running and support the country's natural gas requirements
moving forward.

In a briefing yesterday, First Gen president and chief operating officer
Francis Giles Puno said the company is in favor of the development of a LNG
terminal because it is crucial in addressing the depletion risk of the
Malampaya project by 2024.

The company had discussions with state-run Philippine National Oil Co.
(PNOC) on possible options available for the development of the LNG
terminal.

"That's the discussion we're having with PNOC, how do we ensure we cooperate
with them in order to ensure that this investment pushes through. The role
of PNOC is obviously an important role," Puno said.

The company official, however, said talks with PNOC are not yet final.

"It's not in an advance phase where we can sign anything. but I think all
our discussions have been serious not only with PNOC, but also with others,"
Puno said.

Now is the good time for the country to start investing in the LNG industry
since there is an abundant supply globally, First Gen chairman and chief
executive officer Federico Lopez said in the same briefing.

"There are many existing projects today that still don't have markets. There
are many reserves that have not been developed, tapped. It's actually a very
good time," he said.

If discussions push through in building the LNG terminal, First Gen is
eyeing to secure a significant ownership of 30 to 35 percent in terms of
equity.

"On the equity front, we've always been flexible. Right now, we're solely
underwriting the risk. but the whole idea is bring in partners and to
cooperate with a number of partners for LNG to be able to make sure that the
LNG terminal is built," Puno said.

"What we'd like is to have a significant ownership. What that means is it
can be as little as 30 percent and have others doing it depending on who
will comprise the total consortium," he said.

Earlier, the Lopez-led firm said it will aggressively pursue its $1-billion
LNG terminal within its clean energy complex in Batangas. It houses the
1,000-megawatt (MW) Sta. Rita, 500-MW San Lorenzo, 414-MW San Gabriel and
97-MW Avion gas plants.

Puno said putting up the LNG terminal in their property would be more
advantageous for the country since a lot of work has already been done in
the area to ensure that area is a feasible site.

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Link to Original Article:
http://www.philstar.com/business/2017/05/10/1698354/first-gen-open-30-stake-
planned-lng-terminal

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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com