Philippines Set To Receive First-Ever LNG Cargo For Power Generation

The Philippines has purchased its first-ever liquefied natural gas cargo, which will be delivered this month and will fuel a 1,200-megawatt power plant, according to global energy trader Vitol.

Vitol Asia Pte Ltd, a supply and trading unit of Vitol Group, will supply the LNG cargo to San Miguel Global Power Holdings Corp from its global LNG portfolio, Vitol said in a statement.

It did not reveal the quantity or price.

The purchase comes after Asian spot LNG prices fell sharply from all-time highs last year, when Russia cut gas supplies to Europe in the aftermath of the Ukraine war, sparking a rush of purchases by European nations.

Faced with declining output from its Malampaya natural gas field, the Philippines is the region's newest LNG buyer, looking for alternative fuel supply for existing gas-fired power plants totaling more than 3,000 MW, including San Miguel Global's 1,200-MW Ilijan plant.

The LNG cargo will be delivered to the Atlantic, Gulf and Pacific (AG&P) import terminal in the Philippines, which is based in Singapore, around mid-April.

"This is a significant milestone," Vitol Asia president Mike Muller said. "We look forward to bringing more LNG supply from around the world to meet the Philippines' rising gas demand."

San Miguel Global, a subsidiary of the Philippine conglomerate San Miguel Corp., owns several power generation assets, including the Ilijan plant in Batangas province, 142 kilometres (88 miles) south of Manila.

According to Vitol, Ilijan's power output will supplement the country's generation capacity significantly in the face of rapidly increasing post-pandemic demand.