Manila, Philippines - A World Bank study has shown the feasibility of pursuing a natural gas project in Mindanao, a Department of Energy (DOE) official said.
But more studies on the financial viability and cost-efficiency of the project will be conducted by the DOE.
“Based on the World Bank study so far, they validated that there is potential for use of natural gas in Mindanao,” DOE Undersecretary Jose M. Layug Jr. said.
“They are looking at what we call an FSRU, a floating storage and regassification unit with a component for short pipeline that will run along certain areas that traverse the industrial zones in Mindanao,” he said.
The FSRU might be installed in Misamis Oriental given the depth of the water that can support the vessel, Layug said.
The World Bank study was presented to DOE officials on Wednesday in Cagayan de Oro City.
Imported natural gas is expected to supply a 300-megawatt (MW) power plant, which will also be located in Mindanao.
“So far based on their study, they said that a 300-MW power plant will be good that is fired by natural gas,” Layug said.
The anchor load, which will ensure a demand for the imported natural gas, will also make the project commercially viable.
Further studies and public consultation will be conducted by the DOE.
“What we would need to do now is study carefully the cost-efficiency of the project because we want to make sure as we propose developmental projects in Mindanao that it is something that the people in Mindanao can afford,” Layug said.
Specifically, the DOE will consult with local industries to know their needs and demand profile in the next five years.
“The World Bank study is only a feasibility study, we are still going to look into the cost and whether ultimately the cost can be afforded by the people in Mindanao,” Layug said.
To date, the country has a $2.1-billion natural gas master plan, which includes he construction of an integrated Bataan liquefied natural gas (LNG) terminal and several LNG-fired power plants.
The Philippine government has been wanting to put up a gas pipeline from Batangas all the way to Subic in Zambales.