Big business magnates Sabin Aboitiz, Ramon Ang, and Manuel Pangilinan have sealed a US$3.3-billion energy deal that will augment the country’s power supply with over 2,500 megawatts (MW) of generation capacity.
In a recent disclosure to the Philippine Stock Exchange Monday, Aboitiz Power Corp., Meralco PowerGen Corp. (MGen), and San Miguel Global Power Holdings Corp. (SMGP) said they are embarking on the country’s first and most expansive liquefied natural gas (LNG) facility in Batangas.
“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,” Pangilinan, Manila Electric Company (Meralco) chairman and chief executive officer, said.
The deal involves the acquisition of equity interest in Chromite Gas Holdings, Inc. (CGHI), where MGen will buy 60% of the stake and AboitizPower’s Therma NatGas Power, Inc. (TNGP) will purchase the remaining 40%.
CGHI, in turn, plans to invest in SMGP’s 1,278-MW Ilijan power plant. CGHI and SMGP will also invest in a 1,320-MW combined cycle power facility — an LNG import and regasification terminal owned by Linseed Field Corp.
The companies said the new facility is under construction and will commence its operation by the end of this year.
“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,” Aboitiz, the chairman of AboitizPower, said.
AboitizPower president and CEO Manuel Rubio noted that “in an energy transition characterized mostly by the influx of variable renewable energy, the inclusion of LNG plants supports our pragmatic approach.”
“As a transition fuel, LNG will complement the variabilities of solar and wind power generation, helping maintain the stability of the aggregate supply and the whole power system,” he added.
Relatively, CGHI eyes to own a 67% stake in both the Ilijan power plant and the combined cycle power facility. The deal is aligned with the Marcos administration’s goal to increase LNG’s share in the power mix to 26% by 2040.
Compared to traditional fossil fuels, LNG has lower greenhouse gas emissions that will contribute to combat climate change, improve air quality, and enhance public health. It is also an ideal transition fuel to a renewable energy future. (PNA)