More LNG coming to Philippines next month

Philippine utility First Gen has awarded a contract to TG Global Trading, a subsidiary of Japan’s gas utility provider Tokyo Gas, for a liquefied natural gas (LNG) cargo, which is expected to enhance the country’s energy security.

The Japanese firm is set to supply 125,000 m3 of LNG in a single shipment on a delivered ex-ship (DES) basis to First Gen’s affiliate, First Gen Singapore. The cargo will be received and stored at the BW Batangas floating storage and regasification unit (FSRU) moored at the First Gen Clean Energy Complex (FGCEC) in Batangas City since last June.

Scheduled for delivery in July 2024, this is said to be the country’s fifth LNG cargo, after the fourth was supplied by China’s CNOOC earlier this month. At that time, First Gen shared its plans to look for long-term contracts to secure sufficient energy for its gas-fired power plants.

The LNG will be used for four gas-fired power plants situated in the FGCEC. With a combined capacity of 2,017 megawatts, these plants also receive gas from Malampaya, an offshore gas field that recently withstood a typhoon without interruption in supply.

First Gen’s wholly-owned subsidiary FGEN LNG built an interim offshore LNG terminal in partnership with Tokyo Gas and signed a five-year time charter party (TCP) agreement for the BW Batangas FSRU to provide storage and regasification services. The first LNG cargo was received last July.

The interim terminal aims to speed up the introduction of LNG to the Philippines, especially since predictions suggest the Malampaya field could be depleted by 2027. The terminal is, thus, considered a key factor in ensuring the country’s energy security and helping produce ample electricity for Luzon, its largest island.

As for Tokyo Gas, the firm recently sold minority interests in four LNG projects off the coast of Australia. The move is expected to enable the Japanese player to continue pursuing energy transition-related investments while helping it achieve other medium-term objectives.