Energy dept moves to start Philippines CNG pipeline project
23-JUL-2008 Intellasia | Inquirer
Jul 23, 2008 - 7:00:00 AM
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In a bid to give the government's compressed natural gas (CNG) programme a boost, the Department of Energy said Monday it had initiated talks with the Shell Companies in the Philippines and the Lopez group of companies on a pipeline project to bring natural gas from Batangas province to Manila.
Energy Secretary Angelo Reyes said plans were on the table or converting a bunker fuel pipeline that Shell and the Lopez group own, through First Philippine Industrial Corp (FPIC), into one that would carry natural gas.
"We are discussing this with Shell and the Lopez group to see how we can work out a situation where all the stakeholders, not just the owners of the pipeline, can profit from a win-win situation," Reyes said at a news briefing. He said the talks were about how "to finance the retrofitting of that pipeline so that it can convey natural gas. This is a major effort we're trying to undertake," he said in a briefing yesterday.
The FPIC-operated pipeline transports petroleum products of Pilipinas Shell Petroleum Corp and Chevron Philippines Inc. from Batangas to their Metro Manila depots.
The Lopez group's First Gas Holdings Corp also holds a franchise to operate a natural gas pipeline in Luzon.
In January 2001, Republic Act 8997 granted FGHC a franchise to "construct, install, own, operate and maintain" pipeline systems for the transportation of natural gas throughout Luzon. First Gas Holdings on September 6, 2005 transferred this franchise to its sister firm, First Gas Pipeline Corp.
The franchise, which is valid for 25 years and will expire on February 25, 2026, requires its holder to start exercising any of the rights and privileges provided within five years from effectivity.
First Gas Pipeline over the years has done several studies relating to construction and operation of a natural gas pipeline.
"The pipeline exists, it only has to be rehabilitated or retrofitted," Reyes said.
To facilitate "conversion to CNG as an alternative fuel, we have to ensure that it is available," he said. "That's why we have to put up this pipeline. We want the gas in the Malampaya [off the southwest island of Palawan[ to be used not just for power generation but also for the transport sector."
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