Fri Feb 03, 2006
First Gen Corporation of the Lopez group is changing its tack on the implementation of its proposed 0-million Batangas-Manila natural gas pipeline project.
Instead of aligning a power facility as anchor load, the company has opted to adopt phased construction of the pipeline, catering first to whatever are in tow as available users of the line.
First Gen president and COO Federico R. Lopez affirmed that there was a non-binding memorandum of agreement executed with Cocochem for the installation and operation of a three-kilometer gas distribution pipeline that will transport the natural gas supply to the said client firm’s facilities in San Pascual, Batangas.
This venture is expected coming to a close by the second half of this year.
To steer the project’s implementation, First Gen already transferred the franchise and all of its rights, title, interests, privileges and obligations under a spinoff firm, FGPipeline.
Cocochem is the largest oleochemical plant in the country; and utilizes over 16 million liters and 3.5 million liters of Bunker-C and diesel fuels, respectively.
The company is reportedly firming up interest to switch fuel use for its facility to natural gas due to operational and environmental concerns.
The FG Pipeline will be spending million for the Cocochem leg of the pipeline project.
It was also gathered that aside from a gas pipeline, First Gen is also studying the possibility of operating a fuel logistics business primarily a liquefied natural gas (LNG) import terminal.
On the pipeline project, First Gen secured a franchise for 25 years due to expire on February 25, 2026.
However, it was specified in its mandate that it "must commence the exercise of any privileges granted" under the franchise within five years from its effectiveness, otherwise, this shall be deemed revoked; and such prescribed period is already due to lapse February 25 this year.
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