MRC 'Finalising' Philippines Terminal Report

Manila-listed MRC Allied December 6 said it is finalising a report on the LNG import terminal project that it wants to build with two Chinese partners.

Last year the company signed a memorandum of understanding with China Energy Engineering Corporation (CEEC) and its affiliate Guangdong Power Engineering Company (GPEC) “to explore the possibility of investing, constructing, developing and operating LNG projects in the Philippines”.

The MoU had a period of one year within which project evaluation and due diligence activities had to take place. “Considering that the said one-year period has just recently lapsed, the technical team of MRC is now finalising its report on the matter including project analysis, evaluation and recommendation on the project. Pursuant to the terms of the MoU, the final report shall be presented by management to the MRC board during the next board meeting for its information and further instruction,” MRC said.

As Shell-operated Malampaya, the country’s only commercial gas field, is expected by the government to run out of gas in the next five to six years, ministers are encouraging investors to build LNG infrastructure as it needs to keep its gas-fired generating assets viable.

There has been a strong response from the industry. Earlier this week, Japanese utility Tokyo Gas signed an agreement with First Gen Corporation to develop an LNG receiving terminal in the country. In addition to the Tokyo Gas-First Gen agreement, other deals have been signed this year. In June, Phoenix Petroleum, signed a memorandum of understanding with Cnooc Gas and Power, a unit of China’s Cnooc, to develop an LNG import terminal. In the same month South Korea's SK E&S signed a letter of intent with the Philippines government for the construction of LNG infrastructure in the country worth $1.7bn.