Brunei Eyeing Mindanao LNG Project

Brunei is keeping its eye on the proposed liquefied natural gas (LNG) facility to be put up in Mindanao as part of the grid's long-term energy supply plan.

Energy Secretary Rene D. Almendras disclosed to reporters that this was discussed preliminarily with his counterpart, Brunei Darussalam Energy Minister on the sidelines of the Asia Pacific Economic Cooperation (APEC) Leaders' Summit in Vladivostok, Russia.

"I invited Brunei to have a serious look at Mindanao ... they are interested in LNG projects," he said.

The investment offer to Brunei, he explained, is being anchored on their interest to supply the country with gas.

"They don't want just to be a supplier of natural gas, they're also looking at downstream opportunities ...which could be power generation," the energy chief has noted.

He added that the capacity being explored is 300 megawatts or even higher, stressing that such scale may already prove viable for the deployment of LNG floating storage and regasification unit (FSRU) in the region.

Almendras noted that the setting up of LNG facility is part of the long-term plan for Mindanao. It will address mid-merit capacity needs of the grid following the construction of the coal-fed baseload plants.

The site for the planned LNG handling facility in the region will be in Macajalar Bay in Misamis Oriental, based on the outcome of the study of Canadian Gas Service International (CGSI), the entity contracted by the World Bank group to map out the transactional design of the proposed Mindanao LNG project.

It was British firm Arup which made the recommendation on the suitable site, and such was incorporated in the study result submitted to the Department of Energy.

The gas facility is not only targeted for power applications, but it may also cater to the needs of industries as well as the regions' transport sector.

The study emphasized that the identification of supplemental end-users is hinged on the fact that "the power demand in Mindanao is not big enough to serve as anchor market for the LNG facility."

The transactional framework being carved out for the re-gas facility will be a public-private partnership (PPP) arrangement, it was said.

Investors will be tapped for the "development, construction and operation of a floating terminal" at the proposed site.

Apart from the Mindanao project, the energy department is also pursuing the development of LNG facilities in the Luzon grid. One of the proposed sites would be Batangas; while private investors are separately looking at Quezon and Bataan. (MMV)

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