First Gen Corp. on Wednesday signed a joint development agreement with Tokyo Gas Co. Ltd. to jointly pursue the development of FGen LNG Corp.’s liquefied natural gas terminal project in Batangas province.
“Tokyo Gas will take a 20-percent participating interest in the FGen LNG Project and provide support in development work to achieve a final investment decision,” First Gen said in disclosure to the stock exchange.
Upon reaching FID under the JDA, the parties will sign a definitive agreement to proceed with the construction of the FGen LNG Project.
“First Gen is excited to partner with Tokyo Gas, a world-class natural gas and LNG company with vast experience in the development, financing, construction and operations of LNG storage and regasification facilities. First Gen and Tokyo Gas share the common belief that the country needs clean natural gas to produce power which is not only cost-competitive but, given its flexible operations, is the perfect complement to a growing renewable energy industry,” said First Gen president Giles Puno.
Tokyo Gas was declared by the Energy Department as one of the seriously interested companies to develop an LNG facility in the country.
The government views an LNG terminal as a vital national infrastructure to maintain and enhance the country’s energy security once the Malampaya gas field in northwest Palawan is depleted by 2024.
“Finally, we both share the vision of the Department of Energy in the implementation of LNG projects in the Philippines. First Gen and Tokyo Gas intend to cooperate with all relevant stakeholders who share the same vision to participate in making LNG viable for the Philippines,” said Puno.
First Gen short-listed two engineering, procurement and construction contractors for the planned LNG facility.
“The company continues to work on various development activities to be able to advance the project and make a final investment decision. The LNG terminal’s front end engineering design has been completed, and it is now going through a tender for the EPC Contract in which it has shortlisted two tenderers,” the company said in an earlier report to the PSE.
First Gen said it would pursue and develop its planned import and re-gasification LNG terminal for completion in 2024.
FGen LNG is a wholly-owned subsidiary of First Gen, one of the biggest independent power producers in the country and the leading gas power generation company in the Philippines with approximately 2,000 MW in operating gas assets composed of four gas-fired power plants.
“Tokyo Gas is pleased and delighted to have signed the agreement with First Gen which is the leading company utilizing environmentally-friendly natural gas in the Philippines, and which has been contributing to realize a low carbon society,” said Tokyo Gas president Takashi Uchida.
He said Tokyo Gas aimed to become instrumental in introducing LNG to the Philippines “by pursuing the FGen LNG Project and developing a safe and stable energy infrastructure system, taking advantage of its LNG expertise accumulated for half a century.”