Phoenix Petroleum to add LNG to its portfolio

Listed Phoenix Petroleum Philippines Inc. is positioning itself to add liquefied natural gas (LNG) in its portfolio once the Malampaya gas project runs out of supply, a ranking official said.

The oil company is seriously considering LNG in its list of products, Phoenix CFO and incoming head of corporate finance and treasurer Joseph John Ong said.

“We’re interested in LNG, but right now there’s no demand for LNG. We need to wait for off-take demand for LNG, maybe after Malampaya runs out. When it runs out, maybe there will be demand for importation,” he said.

The main business of Phoenix is trading and whatever the market needs, it will sell it, the company official said.

So far, Phoenix is already trading fuels, the biggest segment of the oil and gas industry. It is also into liquefied petroleum gas (LPG) trading with the acquisition of PETRONAS Energy Philippines Inc. (PEPI), now called Phoenix LPG Philippines Inc.

“LNG is something we’re definitely watching carefully, I believe it will happen…we just have to wait for the offtake and that will most likely have to be in the power sector,” Ong said.

The contract for the Malampaya gas-to-power project offshore Palawan expires in 2024.

However, Shell Philippines Exploration B.V. (SPEX) – the operator of Malampaya with a 45 percent interest—said the project could still provide gas supply beyond the 2024 expiry of its contract, or until 2027 to 2029.

Earlier, it was reported that Phoenix is teaming up with China’s state-owned CNOOC Gas and Power Group Co. Ltd. to develop a LNG gas project with Philippine National Oil Co. (PNOC) in Batangas.

Phoenix, however, clarified that nothing has been discussed or negotiated between the two parties.

“Parties merely want to explore for any possibility of partnership relationship, the terms of which is still unclear as of this point,” the oil firm said.

PNOC was tasked by Energy Secretary Alfonso Cusi to put up an integrated LNG hub with storage, liquefaction, regassification, and distribution facility, as well as a reserve initial power plant capacity of 200 MW.

But the DOE has issued the Philippine Downstream Natural Gas Regulation (PDNGR), detailing the rules and regulations governing the downstream natural gas industry to develop a market and gain energy security and sustainability.

The agency has received letters of intent (LOI) to build the LNG facility from seven companies – namely state-run Philippine National Oil Co. (PNOC), Carmine Energy Pte. Ltd., Vires Energy Corp., local firm Cleanway with UK-based Resiro, Japanese firm Tokyo Gas, Lopez-led First Gen Corp. and China National Offshore Oil Co. (CNOOC).