Regional LNG: Philippines’ MGen eyes additional LNG sources as gas plants Near Completion

Meralco PowerGen Corp. (MGen), the power generation arm of Manila Electric Co. (Meralco), is seeking to diversify its liquefied natural gas (LNG) sourcing portfolio as it prepares to bring 2,500 megawatts (MW) of gas-fired capacity online.

MGen President and CEO Emmanuel Rubio said the company is looking to add more trading partners beyond its existing LNG contracts with Shell and Vitol Asia Pte. Ltd.

“We have a 10-year contract with Shell and Vitol... But we’ve not limited ourselves to these two. By the end of the year—hopefully sooner—we’ll have around 15 trading candidates so we can optimize supply,” Rubio told reporters over the weekend, as reported by Manila Bulletin.

Rubio noted that MGen sources LNG through the Wholesale Electricity Spot Market (WESM).

He also confirmed that the full 2,500 MW of gas-fired capacity is expected to become available soon. “We still don’t have power for the third unit, but it’s fully operational. And by the end of this month, the first onshore storage will be completed,” he said.

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Meanwhile, the Energy Regulatory Commission (ERC) has yet to finalize its evaluation of the power supply agreements (PSAs) for the Ilijan and Excellent Energy Resources Inc. (EERI) power plants.

In 2024, the ERC announced its intention to review a US$3.3 billion (approximately PHP 166 billion) joint acquisition deal involving MGen, Aboitiz Power Corp.’s Therma Natgas Power Inc., and San Miguel Global Power Holdings Corp. (SMGP).

“Our review of the Ilijan and Excellent Energy PSAs relates to potential violations of bilateral contracting limits. We need to determine who controls the plants. If it’s Meralco through MGen, we need to assess whether that breaches the 50 percent threshold,” said ERC Chairperson Monalisa Dimalanta.

The Philippine Competition Commission (PCC) previously approved the joint acquisition, subject to conditions aimed at maintaining fairness and competition in the power market.

Through Chromite Gas Holdings Inc., MGen and Therma jointly hold a 67 percent stake in South Premiere Power Corp. (SPPC), EERI, and the Ilijan plant. The consortium has also partnered with SMGP to acquire Linseed Field Corp. (LFC).

Editing by Reiner Simanjuntak