Brunei eyes LNG facilities in Mindanao

September 19, 2012
By Amy R. Remo
Philippine Daily Inquirer

The energy ministry of Brunei Darussalam has expressed interest to put up liquefied natural gas (LNG) facilities in Mindanao, including the construction of a 300-megawatt gas-fired power plant to serve as an anchor load.

According to Energy Secretary Jose Rene D. Almendras, the Philippine government extended the invitation to Brunei to “have a serious look at the LNG prospects in Mindanao” during the 20th Asia Pacific Economic Cooperation (Apec) leaders’ summit in Vladivostok, Russia, earlier this month.

“They have expressed interest. They said they will come over and study it. The minister of energy of Brunei was very pleased with my invitation because they have also made a decision that they just don’t want to be a supplier of natural gas. [Brunei] also wants to integrate downstream initiatives,” Almendras explained. “I hope that we can interest them into becoming a natural gas power generator for Mindanao.”

Should the proposed investments push through, the LNG project in Mindanao would be a first for the island and the first foray of the Brunei government into LNG downstream investments outside its country.

The energy chief noted that the move to invite investors to look at prospective LNG projects in Mindanao was aligned with the Philippine government’s efforts to provide more sustainable solutions to the perennial power supply problems on the island.

A recent World Bank study on the feasibility of LNG projects in Mindanao has identified several potential locations, including Davao, General Santos, Iligan, Cagayan de Oro and the Phividec industrial complex in Misamis Oriental.

The study, according to the Department of Energy, looked into “parallel markets that will also use natural gas such as the industrial, commercial application as well as the transport sector to help pay for the costs of the proposed LNG terminal” since the power demand in Mindanao is not big enough to serve as anchor market for the LNG facility.

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