Gov't eyes $1.2-B Batangas-Manila gas line

The government is set to bid out a $1.2-billion natural gas pipeline from Batangas to Manila (Batman 1) in March as part of a long-term power project that is expected to bring down the cost of natural gas in the country. The Office of the Press Secretary said the project is part of the Arroyo administration’s long-term integrated natural gas infrastructure project that will connect the 100-kilometer Batman 1 pipeline to Malampaya’s existing Palawan-Batangas gas pipeline to Manila. The project, a joint venture between the Philippine National Oil Co. (PNOC), Abu Dhabi-based conglomerate Sultan International Holdings (SIH) and its local representative Abacus Consolidated Resources and Holdings, and Italy-based SAIPEM Eni, is expected to bring down the cost of natural gas used by the country's households and transport sector. Batangas Rep. Hermilando Mandanas, following a courtesy call to the President together with representatives of the pipeline project's proponents, expressed hope that the bidding would proceed before mid-March "so we can comply with all the legal requirements." Meanwhile, SIH senior representative Nicholas Clemens said his company considers the Philippines a good investment destination. "We will go through the terms of this transaction in great detail. As soon as we finish the negotiations, we will establish the terms of the investment," he said. Other companies have already signified interest in the project, including PTT Public Co. Ltd. of Thailand, Marubeni Corp. of Japan, Gazprom of Russia and Petrochina Co. Ltd. of China. Aside from constructing Batman 1, the PNOC joint venture also involves a liquefied natural gas reception terminal and a 600- to 800-megawatt (MW) power plant, which will draw from the estimated 300-MW excess capacity of the Malampaya deep water gas-to-power project. The Malampaya consortium, a tenth of which is owned by PNOC and the balance by Shell Phils. Exploration BV and Chevron Texaco, provides natural gas to three power facilities with a combined capacity of 2,700 MW. These power plants, in turn, provide power to distributors like Manila Electric Co. Aside from Batman1, the 140-km Bataan-Manila (Batman 2) pipeline, is now being eyed for development. Emergency powers amidst El Niño As discussions on the project unfolded, Deputy Presidential Spokesman Gary Olivar said that Malacanang is concerned about the effects of the ongoing El Niño phenomenon on the power output of the country's hydroelectric plants. Olivar acknowledged that businesses may be affected, but was also quick to assure that contingency measures were already in place. "If the problem gets to be serious that [emergency power] is one alternative that is open to [President Arroyo]. Hopefully hindi aabot sa ganoon. I don't think we're there yet at inaasahan natin na hindi tayo aabot sa ganoong sitwasyon (We're hoping that we don't reach that point)," he said. Olivar said the government was closely watching the country's power situation. "We will make the necessary adjustments. The important thing is the situation is being monitored and amply addressed," he said. Olivar said the power industry in Luzon had given its commitment to see to it that there will be no prolonged power interruptions, with similar commitments being sought from the Visayas- and Mindanao-based members of the power sector industry. — TJD/NPA, GMANews.TV