Gov’t mulls bidding for Malampaya banked gas

MANILA, Philippines - The government is eyeing to bid out unused Malampaya natural gas, more commonly known as banked gas, within the year, a member of the gas-producing consortium said.

Sebastian Quinones, managing director of Shell Philippines Exploration B.V (SPEX), said the banked gas totaling 300 megawatts is now being readied for bidding.

SPEX, the lead operator of the Malampaya deep water-to-gas power project, told reporters. The consortium is now in the process of putting together (the bidding)…So hopefully within this year.”

The government had planned to jointly auction Philippine National Oil Co.’s 150-MW banked gas together with SPEX’s banked gas also amounting to 150 MW. SPEX, as contractor of Malampaya, has its own banked gas.

The PNOC banked gas is stored in the reservoir of the Malampaya project and is owned by PNOC.

The government paid for the gas and reserved it for future use.

Petilla earlier said the gas would be sold to power generation companies to augment power supply and avoid electricity shortage by 2015 when there would be tightness in supply as the economy grows.

He said it would be used for additional capacity and not for existing power generation capacity.

Petilla said PNOC and SPEX were studying the pricing scheme for the banked gas sale.

He earlier proposed that interested buyers of the banked gas to establish a 400-MW plant to help meet Luzon’s power requirements during peaking hours.

Some private power players have expressed interest in bidding for the banked gas.