SMC to build LNG power facility

Published November 2, 2020, 6:30 AM

by Myrna M. Velasco

           To prop the country’s need for more flexible power capacity, the energy investment arm of San Miguel Corporation (SMC) will be building 2,550 megawatts of power facilities that will be utilizing imported liquefied natural gas (LNG) and to reach commercial operations in 2022.

           In a virtual briefing with reporters, SMC President and Chief Operating Officer Ramon S. Ang said the proposed project will be done in three phases at 850MW capacity each. This will be sited in Batangas, proximate to the existing 1,200MW Ilijan gas-fired power facility.

San Miguel Corporation (SMC) president and chief operating officer Ramon S. Ang

          SMC Global Power Holdings Corporation is the subsidiary that will be advancing this venture to implementation; and the plan is to offer its capacity in a tendering exercise that power utility giant Manila Electric Company (Meralco) will be undertaking on its competitive selection process (CSP) for new power supply agreements.

          “The power generation group of San Miguel, we are now switching to LNG. We intend to build three lines of 850MW, so that’s 2,550MW,” Ang emphasized.

           He said the development blueprint sets for targeted commercial operation date of the initial 850MW by 2022; the timeframe when imported LNG is to start flowing into the country.

           Ang said the company will have its own floating storage regasification unit (FSRU) to supply LNG to its own gas plants – and exploratory discussion for tie-up is being pushed with Batangas-headquartered engineering and gas firm AG&P.

          “All of that can be up and running in two years. In 24 months, that plant will be up and running. Whether we win Meralco bid or not, we will construct the first line of 850MW,” Ang stressed.

           He specified that the alternative off-takers (capacity buyers) could be the electric cooperatives (ECs), primarily those that are operating in the interconnected power grids of Luzon and Visayas.

           The longer term goal, according to Ang, will be to double their gas capacity to more than 5,000MW – depending on how electricity demand gains traction with economic recovery post-pandemic.

                The gas sector is deemed as the next sphere of intense competition among power generators, especially with the recent declaration of Energy Secretary Alfonso G. Cusi for a moratorium on new coal-fired power plant installations.

               Gas technology is similarly seen as the ‘perfect match’ that the power sector must opt for given the country’s grand ambition for renewable energy (RE) developments that could add 14,000 to 15,000MW of capacity in the energy mix in the next 10 years.

               On San Miguel’s part, Ang indicated that they are also eyeing to replace some of their old coal plants with LNG-fed generating facilities, so dilemmas on forced outages could be minimized in the electricity system.