FGEN: Gas project encounters delays

FGEN LNG Corp. (FGEN LNG), a subsidiary of First Gen Corp., is moving the target completion of its liquefied natural gas (LNG) project after it encountered delays.

The company has asked the Department of Energy (DOE) to extend the validity of its Permit to Construct, Expand, Rehabilitate and Modify (PCERM) for its Interim Offshore LNG Terminal from September 23, 2022 to March 2023.

“The request is due to projected delay in the completion of the project caused by events and circumstances not within the reasonable control of FGEN LNG,” it said.

Separately, FGEN LNG and its Floating Storage Regasification Unit (FSRU) provider, BW FSRU IV Pte Ltd (BW), have agreed to move the delivery of the FSRU BW Paris from the first quarter of 2023 to the end of the second quarter or early third quarter of the same year.

FGEN LNG is developing the Interim Offshore LNG Terminal to accelerate its ability to introduce LNG to the Philippines, to serve the natural gas requirements of existing and future gas-fired power plants of third parties and FGEN LNG affiliates.

“FGEN LNG believes the Project will play a critical role in ensuring the energy security of the Luzon Grid and the Philippines, particularly as the indigenous Malampaya natural gas resource is expected to decline in the next few years,” it said.

The gas facility, in fact, is already experiencing restricted output since last year.

First Gen has earmarked a capital expenditure (capex) of around $550 million this year. Of which, $266 million will be allocated for Energy Development Corp.’s “growth initiatives, drilling programs and upgrades.”

About $135 million of this year’s capex is needed to finish its LNG terminal.

First Gen has also set aside about $70 million for its Aya Pumpedstorage project; about $50 million is for the pre-development work on Santa Maria gas plant; $30 million for maintenance of its other gas plants.