State-run Philippine National Oil Co.-Exploration (PNOC-EC), the upstream petroleum and coal wing of the state-owned Philippine National Oil, plans to setup a 300MW natural gas power plant that will make use of the additional capacity of Shell Petroleum Exploration’s 3,000MW Malampaya deep water gas-to-power project.

Initially, the compnay planned to convert the decommissioned 850MW Sucat bunker fuel-fired power facility into a natural gas station. The proposed BatMan1 pipeline, scheduled to be completed within four years, would deliver the natural gas from Tabangao, Batangas, to the Sucat power plant.

The company owns a 10% interest in the Malampaya project, while Shell Philippines Exploration BV (Spex) and Chevron Malampaya Llc. each has a 45% stake.

Jacinto Paras, chair person of PNOC-EC, said: “We are in the final stage of our study. We’re just looking into the costing and technical aspect of the power plant. We will be open to a joint venture since the cost to put it up is high. We cannot predict who to partner with but there are proposals.”

However, the conversion of the plant would be more costly compted to setting up a greenfield power plant, continued Paras. He also disclosed that PNOC-EC was set to bid for 300MW of excess capacity of the Malampaya field in an auction scheduled in September 2009. PNOC-EC needed the gas supply as this would allow the company to proceed with the construction of the power plant and pipelines,stressed Paras.

Jacinto Paras, said: We’re interested to get that because we need it to implement our project, which is to put up a power plant and the pipelines (BatMan). It is supposed to have either an anchor load or a power plant business.”

The Malampaya deep water gas-to-power project in offshore Palawan supplies fuel to the 1,000MW Sta. Rita, 1,200MW Ilijan and 500MW San Lorenzo plants in Batangas. The excess 300MW, which is remaining from the Malampaya field that can produce gas enough to fuel 3,000MW of power capacity, can be used to fuel another power plant.

However, Energy Secretary Angelo T. Reyes earlier revealed that the government was studying whether to allocate the excess 300MW to power generation or the transport sector. The excess capacity was initially intended for the San Pascual co-generation project of a consortium led by Edison Mission Energy.

Paras said that they were open to downscale the capacity of the proposed power plant to approximately 200MW, if PNOC-EC lose in the bidding.