Virtual LNG pipeline: What does this project mean for power generation in the Philippines?

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Derek Thomas, Head - Advanced Research Unit, AG&P
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In light of our upcoming Gas Asia Summit & Exhibition (GAS), we interviewed Derek Thomas, Director – Advanced Modular Infrastructure at AG&P.

Gastech News: We have recently heard that AG&P is developing a virtual LNG pipeline in the Philippines, what does this project mean for power generation in the Philippines?

Derek Thomas: In order to facilitate economic development, the Philippines needs reliable sources of power and energy across the archipelago. Given the geographic distribution of demand centres it is not possible to satisfy this requirement with a traditional build out of a gas and electric grid but instead, a network of Distributed Energy Resources is required which are scaled according to regional requirements.

AG&P will support this via suitably located breakbulk terminals for trans-shipment of LNG into smaller vessels in order to create a true “Hub & Spoke” network which cost effectively allows for a “Virtual LNG Pipeline” across the whole ASEAN region. This will help power generation move towards cleaner and cheaper fuel and provide for the development of regional industrial clusters based upon ready and reliable sources of power. It will also provide degrees of redundancy which will give more energy security in times of natural disaster and economic conflict. This includes the potential to include biogas and other renewable generated sources into the mix once the distribution infrastructure is in place.

Gastech News: What kind of pre-assessment studies has AG&P completed to move forward with the project?

Derek Thomas: Given the challenges involved, all the stakeholders need to understand which projects offer the best chance of being realised, what the opportunities are and how to mitigate the obstacles in their way. It is imperative for players to be able to navigate the right bureaucratic channels and have a thorough understanding of the implications of plant fuel type, in addition to land matters, fuel supply and transmission access.

Over the past few years, AG&P has been active in developing detailed plans which involve the full range of stakeholders from central government to local communities, power generators, global LNG suppliers, financiers and technology providers. The key to success of individual projects is their integration into the broader network and the effective combination of multiple stakeholders interests under a single umbrella framework, which spreads the upfront costs.

Gastech News: What will lead the future of small-mid scale projects in Asia?

Derek Thomas: There is the need for effective integration between the large scale terminals and the regional distribution network which will be required in order to allow for economic development based on increased access to energy. All the big LNG players are motivated to get into the market but don’t have the mechanisms to penetrate beyond the major import terminals. The smaller regional players face a similar problem from the opposite end, in how to get LNG from a big hub and into smaller vessels for delivery.

The solutions we are proposing will be needed to make the transition to the second and third tier distribution and consumption centres. There remains much confusion and if somebody does not take a lead in producing a coherent strategy for moving forward then the market will remain fragmented and only reach a small fraction of its potential. No single company can do this alone, and our philosophy is to build a strong group of partners that are able to offer a compelling package of technology, engineering, construction, financing, training and operations. This includes owning and operating assets with varying equity positions as appropriate.

Gastech News: What are you most looking forward to about this year’s Gas Asia Summit & Exhibition and what is your final message to our readers?

Derek Thomas: The regional demand for a new, clean and cost effective energy sources has long been identified, but there has been sadly little progress towards this end. Many events focus on particular aspects of the LNG and energy value chain but the inhibiting factor in moving forward the next generation of gas based energy development has been the need for a far more collaborative approach which integrates a range of both technical and commercial approaches.

We feel that GAS takes that sort of holistic view and are very excited to see this year’s event showcase real progress in the development of the gas and energy network across the ASEAN region. AG&P is proud to be involved as a sponsor of the event and showcase our own commitment to creating the "Virtual LNG Pipeline” which will underpin national and regional development.

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Derek Thomas will be leading a workshop on "Cost effective solutions for LNG distribution within the ASEAN region" at the upcoming Gas Asia Summit & Exhibition (GAS) which returns in its 4th edition to the Marina Bay Sands in Singapore from 26 to 28 October 2016.  Book your delegate place and join over 300 international & regional c-level executives, decision makers & technology providers to discuss the dynamics that are revolutionising the Asian gas market today.

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