Regional LNG: Taipower closes LNG supply bids
Monday, March 24 2003 - 11:35 PM WIB
An official at Taipower said the company managed to secure at least three bidders, the minimum required, and would announce a final decision in April.
Local newspapers cited Anglo-Dutch oil giant Royal Dutch/Shell and Taiwan's state-owned Chinese Petroleum Corp , Tung Ting Gas Corp and United Resources Inc as potential contenders.
"So far we have received three bidders. We will see tomorrow if there is any firm who submitted its bid by mail," said an official with Taipower, adding that the names of the bidders would be released on Tuesday.
The contract is to supply 1.68 million tonnes of LNG a year to Taipower's Tatan plant, located in Taiwan's northern Taoyuan county with eight generating units and a designed capacity of 4,000 megawatts.
Taiwan, which used 5.9 million tonnes of LNG in 2002, is heavily dependent on LNG imports, which account for some 90 percent of the island's annual natural gas needs.
Besides the size of the supply deal, Taipower's LNG contract also offers a rare opportunity for foreign ventures to break into Taiwan's energy market, which is dominated by Chinese Petroleum Corp, the sole owner of the island's only LNG receiving terminal.
Taiwan's natural gas demand is expected to rise by an annual 8.5 percent in the next 20 years as more gas-fired power plants begin operations.
The Energy Commission said there would be one private natural gas-powered plant coming onstream this year, followed by three next year.
The island held two rounds of bidding in 2001 for the Tatan plant, but both failed because foreign multinationals stayed away due to perceived difficulties in meeting an ambitious 2004 start-up date required by the Taiwan government.
The date has since been postponed to 2008.
Analysts said another hurdle was a requirement that LNG suppliers also build a receiving terminal for the plant, though Shell has said it was willing to undertake the project.
Taiwan's Tung Ting is also building a terminal with annual capacity of up to seven million tonnes in northern Taiwan, which could be used for this project.(*)