Major LNG project launched in the Philippines

The Batangas Bay LNG terminal in the Philippines. In what they’re calling a landmark development for the Philippines’ energy sector, Meralco PowerGen Corporation (MGen), Aboitiz Power Corporation (AP) and San Miguel Global Power Holdings Corp. (SMGP) are launching the country’s most expansive integrated liquefied natural gas (LNG) facility in Batangas. (Image: AG&P)

What developers are calling the first expansive integrated LNG facility in the Philippines has been launched.

The US$3.3 billion project is being spearheaded by Meralco PowerGen (MGen), Aboitiz Power Corp. (AP) and San Miguel Global Power Holdings Corp. (SMGP) in the city of Batangas.

This initiative is designed to help boost energy security and steer the country towards a cleaner, more sustainable future in line with the Marcos administration’s push for more natural gas in the country’s energy mix.

In the deal, MGen and AP will jointly invest in two of SMGP’s gas-fired power plants—the 1278 MW Ilijan power plant and a new 1320 MW combined cycle power facility which is expected to start operations by the end of 2024 – and together with SMGP will invest in almost 100% of the LNG import and regasification terminal owned by Linseed Field Corp.

Additionally, all three companies will acquire the LNG import and regasification terminal of Linseed Field Corp. This will be used to receive, store and process LNG fuel for the two power plants, thus fully integrating the local energy sector into the global natural gas supply chain.

“This is a pathbreaking venture,” said MGen Chairman Manuel V. Pangilinan. “Apart from transforming the energy landscape of the Philippines, this symbolizes a milestone alliance among major players in the energy industry towards a more sustainable future. We are thrilled to have such reliable partners as we lay the foundation for a brighter, greener future.”

The collaboration will substantially augment the country’s power supply with over 2500 MW of generation capacity once fully operational, backed by advanced LNG storage and regasification capabilities. This effort will not only meet the country’s energy requirements but also support its environmental objectives by significantly lowering emissions, the companies said.

“Both LNG and renewables are needed to achieve a balanced energy mix and well-planned energy transition. Above all, this is a big win for the Philippines and the people. Economic development is impossible without energy security, and this investment is a definitive step forward in that direction,” Sabin M. Aboitiz, AP chairman said.

The Department of Energy’s (DoE) Philippine Energy Plan has identified LNG as crucial for the country’s energy sustainability and security, aiming to boost natural gas’s share in the power generation mix to 26% by 2040. This move also aligns with the Philippines’ own goal to significantly reduce greenhouse gas emissions by 70% by 2030.

The collaboration among the three power companies represents a shared commitment to innovation, reliability, and environmental stewardship in the energy sector.

By leveraging their combined expertise and resources, the collective venture guarantees the delivery of dependable and competitively-priced energy while helping boost economic growth and environmental preservation.