Philippines-based First Gen, an energy company of Lopez Group, has announced its plans to convert an existing and non-operating oil pipeline into a natural gas supply system at a cost of over $100m.
First Gen is planning to undertake the pipeline conversion project in order to provide industries and large power customers in the region with an option for alternative power sources apart from the fuel oil.
As a part of the conversion project, the company is planning to transform the 117km long Batangas to Manila white oil pipeline, which is non-operational since an oil leak incident was reported in 2010.
Batangas-Manila white oil pipeline along with 105km long black oil Batangas to Sucat pipeline is owned and operated by First Philippine Industrial, a joint venture company between First Gen’s parent company First Philippine Holdings and Shell Petroleum UK.
First Gen president Francis Giles Puno said the conversion project is expected to take two to three years and will supply up to 300MW of gas.
"There are two pipelines so you can theoretically convert one line and keep the other line operating," Puno said.
"In many countries they don’t have an existing oil pipeline system. In our case, we have an existing oil pipeline already.
"What we can do is convert that into natural gas and you develop more demand then you can build a brand-new one.
"At least it accelerates your ability to deliver gas to industrial users using the existing oil pipeline," Puno added.