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Pilipinas Shell plans to build LNG facility in Philippines

Sunday, 10 June 2012 19:35 Paul Anthony A. Isla / Reporter

PILIPINAS Shell Petroleum Corp., the local arm of Royal Dutch Shell Plc., is planning to set up a liquefied natural gas (LNG) import facility in the Philippines, the first in Southeast Asia.

“This floating LNG import and regasification facility will be the first in the Philippines. So far, we have one in Qatar,” Roberto Kanapi, Pilipinas Shell vice president for communications, told reporters on Friday.

Kanapi said Shell is planning to construct the LNG import facility within Shell’s refinery in Tabangao, Batangas.

“We are conducting a technical study on it. It is a breakthrough as far as LNG is concerned in the Philippines, as we are now working on a definitive study,” he said.

Kanapi added that the facility in Batangas gives the oil company an advantage over others, as they could quickly build it within the refinery’s premises.

He said the study would also look into how they could transport the LNG from one area to another considering the country’s archipelagic nature.

The LNG import facility, according to Kanapi, could also help power-plant developers set up power plants on small islands.  He said Shell could bring LNG anywhere these plants are located.

Kanapi said the study would help determine the project’s potential actual costs.

Kanapi said they plan to undertake the project on their own and take advantage of their market leadership for LNG when they put up one in the Philippines.

As part of President Aquino’s state-visit to UK, Pilipinas Shell entered into a memorandum of understanding (MOU) with the Philippine government to explore the establishment of an import and regasification terminal for LNG in the Philippines.

Pilipinas Shell said the MOU calls for cooperation and coordination between the Philippine government and Shell for a technical feasibility study which shall determine the viability for the development, construction and operation by Shell of an import and regasification terminal adjacent to its refinery facility in Tabangao, Batangas.

President Aquino and Royal Dutch Shell Chief Finance Officer Simon Henry, witnessed the signing ceremony of the MOU during the two-day visit to the United Kingdom.

Edgar Chua, Pilipinas Shell country chairman, signed the memorandum on behalf of Shell, while Energy Secretary Jose Rene Almendras signed on behalf of the Philippine government.

“We believe this feasibility study for an LNG terminal is a timely activity as it firmly supports the government’s thrust of achieving energy security and promoting cleaner energy,” Chua said.  He added that the feasibility study is expected to be completed by 2012 with a “first-gas” target date in 2016.

The Philippine government, through the DOE, is developing a Natural Gas Master Plan to diversify the country’s energy sources and address the increasing demand for power to support the economic growth of the country.

SOURCE

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