Ibazeta: Batangas-Manila gas pipeline may not be realized this year

MANILA, Philippines - Energy Secretary Jose Ibazeta said the Batangas-Manila (BatMan) gas pipeline project may not be realized this year.

This statement disputes optimism that the government and the Philippine National Oil Co. (PNOC) could wrap up talks on the construction of the BatMan project anytime soon. Ibazeta is the chairman of PNOC.

“There are still some issues that need to resolve. But this does not mean we are not keen on pushing for the project. But it is impossible to have to project done in two years,”he said.

PNOC had earlier admitted having discussions with a consortium led by a unit Eni SpA of Italy for the construction of an integrated natural gas project from Batangas to Manila or BatMan.

In a previous interview, PNOC president Antonio Cailao said they hope to finish the discussion with the group before the end of May.

“The negotiation period is still going on. We hope to finish in 30 to 45 days,” Cailao said.

Last month, PNOC said it would challenge the offer of the Eni SpA. of Italy group for the construction of the country’s first natural gas pipeline.

The “Swiss challenge” started a month ago and is expected to be concluded at the soonest possible time.

A Swiss challenge is a form of public procurement in some (usually lesser developed) jurisdictions which requires a public authority (usually an agency of government) which has received an unsolicited bid for a public project (such as a port, road or railway) or services to be provided to government, to publish the bid and invite third parties to match or exceed it.

PNOC is reviewing the terms offered by the members of the consortium, namely Abu Dhabi-based Sultan International Holdings, local firm Abacus Consolidated Resources Holdings Inc. and Saipem SpA.

Saipem is the engineering and construction unit of Eni, Italy’s largest industrial company with a market capitalization of at least $138 billion. Abacus Consolidated is a local firm whose shares are listed and traded in the Philippine Stock Exchange. 

The group earlier signified intention to build a $1.2-billion natural gas integrated project during a visit byPresident Arroyo in February.

If PNOC sees brighter prospects, it might partner with the Eni group to put up the said gas pipeline.