First Gen, Japan’s Tokyo Gas ink deal for next phase of LNG terminal project

Lopez-led First Gen Corp. on Wednesday said it signed a deal with Tokyo Gas Co. Ltd. for the next phase of their planned liquefied natural gas (LNG) terminal project in Batangas City.

In a disclosure to the Philippine Stock Exchange, First Gen said it signed a joint cooperation agreement (JCA) with Tokyo Gas.

The agreement represents the next phase of both parties’ joint development of FGEN LNG Corp.’s interim offshore LNG terminal located at First Gen’s Clean Energy Complex in Batangas City. 

FGEN LNG is a wholly-owned unit of First Gen for the Batangas LNG terminal project.

“With the JCA, the parties will now transition from the development phase under the joint development ggreement (JDA) which initially governed First Gen and Tokyo Gas’s relationship since December 5, 2018,” First Gen said.

The JCA is a preliminary agreement between the parties to jointly pursue the design, development, testing, commissioning, construction, ownership and operations and maintenance of the offshore LNG terminal project which consists of construction works necessary to modify the existing jetty that will enable it to become a multi-purpose jetty and build an adjunct onshore gas receiving facility. 

In May 2019, First Gen and Tokyo Gas broke ground for the LNG terminal project in Batangas City. 

“Once completed, the project will allow FGEN LNG to bring in a floating storage and regasification unit (FSRU) on an interim basis and thus accelerate FGEN LNG’s ability to introduce LNG to the Philippines,” First Gen said.

The construction of the project is the subject of the permit to construct, expand, rehabilitate and modify (PCERM) granted to FGEN LNG on September 25, 2020 by the Department of Energy (DOE). 

With the PCERM, FGEN LNG is now authorized by the DOE to construct the LNG terminal project.

Under the JCA, Tokyo Gas will have a 20% participating interest in the project and provide support in development, construction, operations and maintenance work to achieve a Final Investment Decision (FID). 

Upon reaching FID under the JCA, the parties will enter into a definitive agreement in respect of the project. —Ted Cordero/KG, GMA News