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First Gen picks Japanese firm as EPC contractor for LNG terminal

LOPEZ-LED First Gen Corp. is developing a liquefied natural gas (LNG) terminal in Batangas City. — DENISE A. VALDEZ

By Victor V. Saulon, Sub-Editor

FIRST GEN Corp. has chosen Japan’s JGC Corp. to handle the engineering, procurement and construction (EPC) of its liquefied natural gas (LNG) terminal project in Batangas City, the Lopez-led company said on Monday.

“This marks the conclusion of an extensive EPC tendering phase which commenced in 2014, during which around 22 companies were invited and 18 expressed an interest to participate in the tender process and work on the [FGEN Batangas LNG Terminal] Project,” it told the stock exchange.

First Gen is developing the project through its subsidiary FGEN LNG Corp., which completed pre-development work to make the site construction-ready. The unit held a groundbreaking ceremony in May this year at the First Gen Clean Energy Complex in barangays Sta. Clara, Sta. Rita Aplaya and Bolbok, Batangas City.

Jonathan C. Russell, First Gen executive vice-president and chief commercial officer, said the group was looking forward to working with JGC on the project, which the Department of Energy (DoE) certified last month as an “Energy Project of National Significance.” The certificate allows a faster permitting process, among other perks.

Mr. Russell said the LNG terminal is crucial to ensure the continued operations of the country’s 3.2-gigawatt existing natural gas-fired plants “given the expected and continuing reduction in gas supply from the Malampaya field up to the expiration of the contracts by 2024.”

Ahead of 2024, First Gen said its immediate focus, along with JGC, is to complete a detailed study on modifications that can be made to the group’s existing jetty that would allow the facility to receive large- and small-scale LNG vessels, and to continue to receive liquid fuel.

First Gen will then look to start building the modified jetty “as soon as possible.” The early completion of this work will allow bringing in a floating storage regasification unit (FSRU) on an interim basis during the Duterte administration.

“This would reduce the strain on Malampaya as its reliability continues to decline up to 2024, increasing the energy security of the Philippines and reducing the number of times that FGEN will be requested to run on liquid fuel when Malampaya gas is unavailable,” Mr. Russell said.

The FSRU will allow First Gen to receive LNG as early as 2021, or before the expiration of the Malampaya gas contracts. The LNG storage ship has an onboard regasification plant capable of returning the liquefied fuel back into a gaseous state. The gas can then be supplied directly to some or all of the company’s existing power plants.

Mr. Russell said the early completion of the facility would also enable LNG “to immediately become a fuel choice for any developer that is considering the building of new gas-fired power plants with a lower carbon footprint.”

The move will support the entry of more intermittent renewables as an alternative to building new coal-fired power plants and also offer a potential means for the Ilijan project to receive gas after its contract with Malampaya ends in 2022, he added.

First Gen described the project as possibly “the most significant energy infrastructure project to be undertaken in the Philippines in more than two decades.”

In March 2019, FGEN LNG received the formal approval of its application for a “notice to proceed” (NTP) from the DoE as defined in and required by the Philippine downstream natural gas regulation. The unit has requested the agency to extend its NTP by a further six months.

The entry of JGC comes after First Gen in December 2018 signed a joint development agreement with Tokyo Gas Co., Ltd., which is taking a 20% participating interest in the project. The signing is a preliminary agreement between the parties to jointly pursue development of the LNG terminal.

First Gen described JGC, as focusing on consulting, planning, basic and detailed design, materials and equipment procurement, construction, commissioning, operation and maintenance services for various process plant and facilities, as well as power generation investment and operation, and technology development services.

Established in 1928 in Yokohama, Japan, JGC is listed on the Tokyo Stock Exchange and has built more than 20,000 projects in more than 80 countries, it added.

“These projects have centered on the oil and gas sector, including oil, natural gas, petrochemicals, and gas chemicals, as well as a variety of other business sectors including energy infrastructure,” First Gen said.

On Monday, shares in First Gen rose by 1.14% to P26.70 each.

Taylor Swift album hits 1 million in China

AMERICAN singer-songwriter Taylor Swift may be more popular in China than the US, going by the first-week sales of her latest music.

Lover, the 29-year-old pop star’s seventh album, sold 1 million in China in its first week of release, Universal Music Group said Aug. 29. US sales are expected to reach 850,000 in the period, based on forecasts cited in Billboard magazine Aug. 28. The figures include streaming equivalents. Swift has been among the most popular Western musicians in China, where some of the biggest internet companies are betting on streaming services to lure users. Chinese social media giant Tencent Holdings Ltd., for example, has been negotiating to buy 10% of Universal from Vivendi SA to help it tap fast-growing Asian markets. Released on Aug. 23, Lover has become China’s most consumed international full-length album this year, Universal said. Swift’s two previous albums, 1989 and Reputation, were both certified for over 1 million copies consumed in China. Universal is still waiting to report on the US sales of Lover as of Aug. 29, a spokesman for the company said by e-mail. The album also claimed the biggest sales week for any in the US this year, according to Billboard. As of Aug. 27, it had sold about 750,000. — Bloomberg

AUB targets first bond issuance in Q4

ASIA UNITED Bank Corp. (AUB) is targeting to schedule the maiden issue out of its P30-billion bond program next quarter, which will also mark its debut in the onshore bond market.

AUB Executive Vice President Antonio V. Agcaoili, Jr. told BusinessWorld that AUB’s first issuance out of its bond program will be a fixed-rate note.

“Definitely it will be a fixed rate note. Hopefully we get to issue sometime in mid-Q4,” Mr. Agcaoili said in a phone message.

“No financial details yet as this is all market determined, i.e. coupon and all,” he added.

AUB last week said its board of directors has approved a P30-billion bond program, with terms, details and timing still yet to be set.

The Ng-led lender’s net income went up to P2.6 billion during the first semester, up by 63% from the first half last year.

This translated to a return on equity of 17.6% and a return on assets of 2.2% compared to last year’s 12% and 1.6%, respectively.

The bank attributed the improvement of its bottom line to securities trading and loan growth. — Beatrice M. Laforga

HII to manage Charlie’s El Nido

HOSPITALITY Innovators, Inc. (HII) is continuing to expand its resort portfolio, as it announced it will manage a new boutique hotel called Charlie’s El Nido in Palawan.

“HII is in its next phase of growth as it expands outside of Metro Manila and takes on more resort properties. We are fortunate to have been invited by the owners to assist them in conceptualizing and planning the product and to manage this beautiful boutique resort for them. Charlie’s El Nido is a really exciting new project for HII being located in the prime tourist destination,” Luis Monserrat, founder and chief executive officer of HII, was quoted as saying in a statement.

Charlie’s is located in Km 279 National Hi-way, Barangay Villa Libertad in El Nido. It is on track to open in January 2020. The hotel is named after the little boy of owners Juan Paolo Tumacder and Garet Bacani-Tumacder.

“We chose HII because of their impressive track record and good business practices. We have the same vision in turning Charlie’s El Nido into one of the best boutique hotels in El Nido for many years to come,” Mr. Tumacder said.

The resort will have rooms with exquisite views, a restaurant and bar, fitness center, and a spa.

“There are a number of 2- to 3-star type of accommodations in the city and resorts in Lio. What we have is a boutique hotel at a 4-star level. Charlie’s comes in at a price point that offers quality but at a lower rate compared to other resorts. With 55 rooms, it is more personalized,” Mr. Monserrat.

HII is a hotel and property management company with a portfolio of 20 hotels, resorts, condotels and serviced residences in the country.

Philippine Airlines’ A321neo SR to be used for regional flights

PHILIPPINES Airlines (PAL) has started a new phase of its fleet modernization program with the receipt of a brand-new jet which it will use for regional flights.

The flag carrier said in a statement yesterday the A321neo SR is the first to be delivered out of its order for 15 new planes, the rest of which will be delivered “over the next few years.”

“Our newest A321neo (SR) will become the single-aisle mainstay for regional routes, helping PAL in our mission to boost tourism from the high-producing tourist countries in the region such as China, Japan, Korea and our ASEAN neighbors,” PAL President and Chief Operating Officer Gilbert F. Santa Maria said in the statement.

The new 195-seater plane was added to PAL’s fleet in July and is designed to travel short-haul flights such as those going to East Asian destinations and Guam. It is customized to have a more spacious cabin and legroom than the A321 Classics and A321neos.

“Our passengers will appreciate the more comfortable layout of the aircraft. The A321neo’s new engines, ‘sharklet’ wingtips and other innovations also make the airplane quieter, more efficient and kinder to the environment, which is good news for the planet,” Mr. Santa Maria added.

On Jan. 1, PAL received the last of its six longer-range Airbus A321neos, completing its order of 15 new planes last year, the rest being four A350s and five Bombardier Q400s. The A321neo is now used for non-stop flights going to Brisbane, Papua New Guinea, Sydney and Sapporo.

PAL now has 98 planes in its fleet. Used for long-haul flights are the six Airbus A350-900s and 10 Boeing 777-300ERs. It deploys 15 Airbus A330s for routes going to Asia Pacific, Australian and Middle Eastern destinations. The rest of the fleet are six longer-range A321neos, 24 A321 Classics, 19 A320s, 10 De Havilland Dash-8-400s and classic versions of Q300/400.

The attributable net loss of PAL operator PAL Holdings, Inc. ballooned to P3.33 billion in the first semester, up 138% year on year, fueled by higher expenses mainly due to the increase in depreciation from implementing a new accounting standard.

In July, the carrier welcomed Mr. Santa Maria as its new president, replacing long-time leader Jaime J. Bautista who retired in June.

PAL Vice Chairman Lucio “Bong” K. Tan, Jr. said the company may miss its target of returning to profit this year, but efforts are under way to minimize costs by improving synergies and tapping aviation consultant Lufthansa Consulting GmbH. — Denise A. Valdez

Actor Kevin Hart injured in Los Angeles car accident

ACTOR Kevin Hart suffered major injuries in a car accident in Los Angeles early on Sunday morning, the California Highway Patrol (CHP) said. Hart, 40, was being driven in a 1970 Plymouth Barracuda shortly after midnight on Mulholland Highway when the driver lost control of the car and it tumbled down an embankment, CHP said in a statement. CHP did not elaborate on the nature of Hart’s injuries, but TMZ reported that he injured his back. The driver, Jared Black, also suffered major injuries in the accident, CHP said. He was not under the influence of alcohol at the time, CHP added. Hart, who is known for his stand-up comedy and comic roles in movies including Ride Along, was able to leave the scene of the crash with a second passenger, who was not badly hurt, and head to his home nearby to get medical attention, CHP said. Hart was taken to Northridge Hospital Medical Center and the driver was taken to another hospital. Hart’s publicist did not respond to requests for comment. — Reuters

Pacquiao launches own cryptocurrency tokens

MANILA — Philippine boxing champion Manny Pacquiao launched his very own cryptocurrency on Sunday at a free concert in Manila, where he serenaded more than 2,000 fans to drum up interest in the product.

The 40-year-old boxer, who defeated Keith Thurman to win the WBA Welterweight Super Championship in July and is also a Philippine senator, hopes to cash in on his “Pac” tokens, which will allow fans to buy his merchandise and interact with him via social media.

The “Pac” token will be listed on Singapore’s Global Crypto Offering Exchange (GCOX) and counts Pacquiao and ex-Liverpool and England soccer star Michael Owen as private investors, along with Sheikh Khaled bin Zayed al-Nahyan, a member of Abu Dhabi’s ruling family.

It is the world’s first celebrity cyrptocurrency. Tennis ace Caroline Wozniacki, Owen and singer Jason Derulo also plan to launch their own crypto tokens with GCOX.

“We are not here to raise a lot of money but to build an ecosystem,” GCOX Founder and CEO Jeffrey Lin told Reuters.

At Sunday’s concert, Pacquiao sang songs from his own album which has sold thousands of copies and covers popular love songs.

“Pacquiao is idolized by many. People will be encouraged to check this innovation,” Aaron Baetiong, 38, who attended the concert, said of the “Pac” tokens. — Reuters

ARB opens new office in Alabang

ARB Call Facilities, Inc. recently opened offices in Alabang and Bacolod City, as the business process outsourcing (BPO) company expands in the so-called next wave cities in the Philippines.

ARB partnered with real estate services firm KMC in acquiring a three-floor office at the Southpark Corporate Center in Alabang.

With a signature blue and white color palette, the office features state-of-the-art pantries, entertainment hubs, sleeping quarters, Grab-Swipe-Go vending machines, coffee bars, and a designated ATM.

ARB Chief Operating Officer Stephen Picciotto said the company is now expanding outside Metro Manila, and with KMC’s help, they have were able to “get into new buildings early” for their new offices.

“KMC was ideal in finding the perfect space. They have always been diligent in providing us with various location options. When we informed them of our plans to expand outside the highly congested Central Business Districts of Metro Manila, Alabang was one of the top recommendations,” he said in a statement.

ARB also opened an office with 11,000 square meters (sq.m.) of space in Bacolod City.

“It is within our brand of service to not only locate our client in the best offices or cities but also help them get ahead in growing their business,” KMC Associate Director Rita Kash said.

ARB now has 20,000 sq.m. of leased office space with over 2,500 employees, averaging 300 new hires per month.

DCWD to invest P400 million for water source

DAVAO CITY — Supply from the bulk water project of the Aboitiz-led Apo Agua Infrastructura, Inc., which is expected to start operations in June 2021, will not be enough to address the increasing water requirements of the city, a top official of the Davao City Water District (DCWD) said Wednesday.

“The project of Apo Agua cannot really fully answer the water demand of the city,” said lawyer Bernardo D. Delima, Jr., DCWD spokesperson.

As such, DCWD will spend about P80 million every year in the next five years to build two production wells to add to its existing 65 wells.

Mr. Delima said their plan is to keep 15 of the 65 wells running alongside the two new ones, once the Apo Agua project starts delivering.

DCWD is projecting demand to reach 122 million cubic meters annually by 2020, and 137 million cubic meters by 2021.

Apo Agua, a consortium between Aboitiz Equity Ventures and JV Angeles Construction and Development Corp., is expected to cover up to 126 million cubic meters, with actual production capacity seen to exceed the contracted supply of 300 million liters per day, or 109.5 million cubic meters annually.

Cirilo C. Almario III, Apo Agua general manager, said project construction is going smoothly and they are targeting to start pipe-laying activities for the 56-kilometer network by the third quarter of the year.

“We are still on track,” said Mr. Almario, noting that they have already started installation of the intake facilities and the treatment facility.

WATER RATES
Meanwhile, Mr. Delima said DCWD has submitted the application to increase the rates by 60% to the Local Water Utilities Administration (LWUA).

“In case the proposed rates are not approved, we need to prioritize the projects that we need to implement next year,” he said.

The proposed increase covers higher operating costs and for capital outlay.

The proposed increase would mean an additional P82 per month for consumers who use the minimum 10 cubic meters and currently pay P137.

“To get a water rate increase is really difficult… you have to pass a tedious process,” said Mr. Delima, explaining that LWUA, after assessing the supporting documents, would determine if DCWD can move on to public consultations.

Aside from public consultations, the water utility will also need to discuss the rates with the business sector and the city government, through the city council.

DCWD, he added, has yet to decide on whether to include in the increase the “lifeline customers,” or those who consume 10 cubic meters a month or less and pay only P100 a month.

These lifeline customers comprise about 12% of the existing 221,000 consumers.

DCWD last implemented an increase in 2005 with half of the increase implemented that year, while the other half was implemented in three tranches over the period 2012-2014. — Carmelito Q. Francisco

Actress Valerie Harper of Mary Tyler Moore Show, 80

ACTRESS Valerie Harper, who won four Emmy awards playing budding feminist Rhoda Morgenstern on the classic 1970s TV series The Mary Tyler Moore Show and her own spin-off sitcom, died on Friday at the age of 80. Harper died on Friday morning, her daughter Cristina Cacciotti said, declining to give further details. Harper’s husband, Tony Cacciotti, said in July that doctors advised that the actress, who was suffering from brain cancer, be placed in hospice care. Harper had revealed to People magazine in March 2013 she had leptomeningeal carcinomatosis — cancer cells in the membrane of her brain. She made a surprising comeback after the 2013 diagnosis, which had given her only months to live. Just seven months later she competed on the Dancing With the Stars program and in 2015 made an appearance on the sitcom 2 Broke Girls. Harper, who also was diagnosed with lung cancer in 2009, stayed busy campaigning for cancer research and taking occasional acting and voice-over jobs as recently as earlier this year. Harper was still relatively inexperienced as an actress in 1970 when she was cast on The Mary Tyler Moore Show — one of the most honored US television shows of the 1970s — as Rhoda Morgenstern, the best friend and neighbor of Moore’s Mary Richards character in Minneapolis. Rhoda was a Bronx-born career girl who was constantly trying to lose weight, find a boyfriend and dodge her meddling Jewish mother. She had a brassy Bohemian streak, as exemplified by her trademark headscarves, and a grasp of emerging feminist concepts but her self-deprecating wisecracks showed her vulnerabilities. Asked why the character was so popular with viewers, Harper told the New Yorker: “They recognized her as real. She had a weight problem and she was insecure. She was a New Yorker. But she also had this victorious streak. She could be belligerent and she could stand on her own.” She told Time magazine that part of Rhoda’s appeal was that she was a loser — but a “victorious loser.” Harper won three straight Emmys for best supporting actress in a comedy on Moore’s show — 1971 through 1973. That same year Harper was given her own show Rhoda, which ran for five years and earned her another Emmy for best actress in a comedy in 1975. With Rhoda moving back to her native New York, her romantic fortunes improved and she married her boyfriend Joe in a widely viewed episode. By the show’s fourth season, however, Rhoda and Joe had divorced and she was back in the dating pool. Harper and Richards reprised their roles in a 2000 television movie, Mary and Rhoda, with Harper’s character returning to New York from Paris after a second divorce and Moore’s character recovering from the death of her husband. Moore died in 2017 at age 80. Harper had a third try at sitcom stardom in 1986 with the family show Valerie. By the show’s second season, Harper and Cacciotti, her husband and business partner, asked NBC for a bigger share of the show’s revenues and threatened to walk off. NBC responded by dumping Harper and bringing in Sandy Duncan to take her place on the show. Harper’s breach-of-contract lawsuit against NBC was dismissed but she did win $1.8 million from the Lorimar production company. Harper’s first husband was TV actor Richard Schaal, another Second City veteran who also appeared on The Mary Tyler Moore Show and Rhoda, from whom she was divorced in 1978. In 1987 she married Cacciotti, a fitness trainer hired to help her get in shape for a swimsuit scene in the movie Chapter Two. — Reuters

Great Brexit insurance sector migration shifts $75 billion from London

LONDON’S outsized role in the global insurance industry is being whittled down by Brexit.

As much as 61 billion pounds ($75 billion) of business is shifting to rival financial centers in the European Union as a consequence of Britain’s vote to leave the bloc. And it’s happening regardless of the divorce terms.

The EU’s insurance and pensions regulator has ordered every UK-based underwriter to transfer policies held by European clients to units on the continent. While the bulk of those total liabilities — the potential payout of all the policies, an industry gauge of scale — has moved or is moving to Belgium, Luxembourg, Ireland and elsewhere, about 5 billion pounds will still be in Britain if Brexit happens Oct. 31, according to the Bank of England’s Financial Stability Report in July.

Lloyd’s of London, the world’s biggest insurance market, stands out as a laggard: About 3 billion pounds is in policies written there over the 25 years before it opened a Brussels subsidiary at the beginning of 2019. If Britain leaves the EU without a comprehensive agreement, Lloyd’s wouldn’t be able to guarantee that it could legally pay claims on those European policies. The institution says they will all be transferred to the continent by Oct. 31, 2020.

A Lloyd’s spokeswoman said EU member states have measures in place to ensure that 90% of the policies can pay out even after a disorderly Brexit. And Lloyd’s has told its syndicates — the insurers that underwrite policies on its trading floor — to honor all claims for continental clients following a no-deal divorce.

The longer-term impact of the shift will be both practical and symbolic, and it matters because London still accounts for as much as one-tenth of the world’s insurance and reinsurance market. Brexit has been chipping away at that role, and the decline could steepen.

EUROPEAN BASES
Most UK insurance companies moved their European business to EU countries earlier this year, ready for the original March 29 Brexit date. Admiral Group Plc, for example, chose Madrid: Chief Financial Officer Geraint Jones said the firm spent 4 million to 5 million pounds transferring policies into a new unit there.

Insurance companies that have yet to move their European business from the UK need explicit permission from authorities in each of the 27 other EU countries to service clients there. Absent those approvals, the insurers can’t legally pay claims or provide other services.

Costs and pitfalls are likely down the road. National regulators won’t allow insurers to use their European subsidiaries merely as letterboxes; those offices will need to be staffed and run as substantial operations.

“There’s a tension, because a lot of the expertise in writing that business still resides in London,” Hilary Evenett, a partner at Clifford Chance LLP, said in a telephone interview. “Over the years, you can also anticipate that other countries are going to develop that expertise locally.” In the future, she said, “it’s not certain how much expertise will be here and how much will be on the continent.”

“There’s a huge amount of expertise and infrastructure around the London market which one might expect to diminish in relative importance over time, but London should still remain the pre-eminent center for insurance for the time being,” Duncan Barber, a partner at Linklaters LLP, said in a phone interview. — Bloomberg

Bria continues expansion in VisMin

MASS housing developer Bria Homes is looking to take advantage of the demand for decent housing in Visayas and Mindanao.

The subsidiary of listed Golden Bria Holdings, Inc. is boosting its presence in key provinces, building more Bria communities to meet the need for safe, secure, and affordable dwellings.

Bria Homes has more than 50 mass-housing projects, with a significant number in the southern Philippines.

In the Visayas, Bria has residential communities in Samar, Leyte, and Negros Oriental. In Mindanao, Bria has projects in Cagayan de Oro, Misamis Oriental, Bukidnon, Davao del Norte, Davao del Sur, South Cotabato, and North Cotabato.

“In the midst of all these, Bria Homes has kept its singular focus: to offer budget-friendly homes to ordinary Filipinos, made possible through the company’s winning formula: Affordability (Mura) + Superior Quality (Dekalidad) = a beautiful Bria Home for Every Filipino,” the company said.

The company has different condominium units and house and lot packages to accommodate varying preferences of homeowners.

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