First Gen awards LNG contract to Singapore-based supplier

September 22, 2024 | 12:00am

MANILA, Philippines — First Gen Corp. of the Lopez Group is securing its fifth shipment of liquified natural gas (LNG) cargo from Singapore-based Shell Eastern Trading Pte. Ltd. next month.

“We just awarded one (contract) to Shell,” First Gen chairman and CEO Federico Lopez told reporters on the sidelines of a forum organized by climate advocate Net Zero Carbon Alliance.

The company conducted a tender offer earlier this month for the delivery of LNG cargo of approximately 154,500 cubic meters.

The cargo is set to be delivered at Subic Bay Freeport in Zambales and will be loaded into the storage tanks of the BW Batangas floating storage and regasification unit, a specialized vessel used to import, store and regasify LNG.

The supply will be utilized by the company’s four gas-fired power plants with a combined capacity of over 2,000 megawatts, which are located at the First Gen Clean Energy Complex.

First Gen is currently procuring its LNG requirements via spot purchases, but Lopez stressed that the Philippines would get the “best benefit of LNG” through long-term contracting.

“You get better terms, and the country will get better terms and prices if you do it that way. I think that’s really where we really need to head,” he said.

Earlier, First Gen awarded a contract to Tokyo Gas unit TG Global Trading Co. for the supply of an LNG shipment of about 125,000 cubic meters.

However, the LNG cargo, originally scheduled for delivery in July, was deferred due to the company still having residual gas on board.

According to Lopez, more LNG cargoes may still be delivered this year “as long as it’s needed because you have to keep the lights on.”

“But again, as we’re saying, it’s always better if you can get into large volumes. If the country gets together and we all contract, pool our volumes together,” the executive said.

First Gen completed its first LNG cargo delivery in Subic in August 2023 and made subsequent deliveries at its Batangas complex in December 2023 as well as in February and May 2024.