Lopez Group to invest P178.4M on gas pipeline to consumers

The Lopez Group is investing P178.4 million to put up a natural gas pipeline distribution from the off take point in the vicinity of the First Gas Holding Corp. (FGHC) compound in Barangay Sta. Rita, Batangas City to industrial customers in San Pascual, Batangas.

The project has gotten approval from the Board of Investments (BOI) to register on a non-pioneer status as a new logistics-pipeline operator.

The company, First Gas Pipeline Corp., is a wholly owned subsidiary of First Gas Holdings Corp. which is 60 percent Filipino and 40 percent British-owned.

According to BOI Managing Head Elmer C. Hernandez, FGPC actually applied for pioneer status registration which would have entitled it to a longer income tax holiday (ITH) of six years instead of the normal four years for non-pioneer status.

However, the BOI board has temporarily granted FGPC registration on a non-pioneer status without prejudice to a future upgrade since the company still has to comply with a few more requirements as a pioneer logistics-pipeline operator.

FGPC’s primary purpose is to build, own, operate and maintain the pipeline system for the conveyance of petroleum and/or mineral products in the country.

First Gas Holdings Corp. is the owner and developer of Sta. Rita and San Lorenzo Power Stations which are the first combined cycle power plant in the Philippines.

FGPC began to conceptualize a pipeline project that would convey natural gas from the Onshore Gas Plant (Malampaya Reserve) in Tabangao, Batangas City to Sta. Rita and San Lorenzo Power Plant for First Gas Power Corp.

The Tabangao to Sta. Rita Pipeline (TSR) project was registered with the BOI on June 9, 1999.

However, there were unresolved issues pertaining to the point of acceptance of the natural gas delivered to the two power plants.

It was thus decided to transfer the ownership of the TSR pipeline to Shell Philippines Exploration.

As a result, FGPC requested the cancellation of their BOI registration with the BOI confirming the cancellation on July 17, 2001.

FGPC plans to sell its pipeline capacity to Cocochem.

The pipeline will transport natural gas bought by Cocochem from First NatGas Supply Corp.