Shell unit mulls power plant to run on natural gas

Intergen Co., an affiliate of Royal Dutch Shell Group, is looking at the possibility of putting up a 600-megawatt power plant that will buy natural gas produced by another Shell unit from an offshore well in western Philippines.

Shell Philippines Exploration B.V. managing director David J. Greer said the power plant to be built by Intergen would help expand the number of end-users for the natural gas to be produced in the Malampaya field by October this year.

But, Intergen is pushing for the project only after the Power Restructuring Bill, the law that would privatize the country’s generation business, is passed.

"It depends on how the power bill passes through," he said.

Greer said the Malampaya field is estimated to have reserves of at least 2.6 to 4 trillion cubic feet of natural gas. This translates to some 3,000 to 4,000 megawatt or more of power that could be sold to interested power plants.

"We believe we have the potential to sell gas beyond 3,000 MW. It could be 4,000 MW or it could be as high as 4,500 MW," he said.

So far, Spex has signed agreements with at least three Batangas-based power plants to buy its produce. These are the 1,000 MW Sta. Rita, the 500-MW San Lorenzo and the 1,200 MW Kepco-Ilijan power plants.

Two more power utilities, Magellan Utilities Corp. and San Pascual Cogeneration Co. have indicated plans to buy natural gas from Malampaya. Both have 300 MW capacity.

San Lorezo and Sta. Rita, owned by a consortium composed of Shell, Texaco and First Gas, plans to expand the Malampaya gas market outside of Batangas.

"We are working with Texaco and First Gas. It is an ongoing process," Gree said, adding that the group is conducting a study on the viability of the expansion program.

Greer said the feasibility study is expected to be completed by June this year.

The study will include the laying of a pipeline from Batangas, where the Malampaya gas will be landed, to other points north including southern Manila.

The expansion program will complement Intergen’s proposal to put up a power plant in Sucat, Parañaque, probably on the site of an old National Power Corp. (Napocor) plant. The said plant is expected to be shut down soon, sources said. – Donnabelle Gatdula