Philippine fuel retailer Phoenix Petroleum said it had agreed to partner with a subsidiary of state-owned China National Offshore Oil Corp (CNOOC) to explore building a receiving terminal for liquefied natural gas in the country.
The Philippines is seeking investors to build a storage and distribution facility for imported LNG as it moves to replace its Malampaya gas reserves, expected to be depleted by 2024.
Phoenix Petroleum, owned by a local businessman who helped bankroll President Rodrigo Duterte's 2016 election campaign, said it had signed a memorandum of understanding with CNOOC Gas and Power Group Co Ltd.
The two companies agreed to "study, plan and develop" an LNG project in the Philippines, Phoenix told the Philippine Stock Exchange on Tuesday. It did not give financial terms of the deal.
Officials of CNOOC, the largest offshore oil and gas producer in China, were not immediately available for comment.
The Malampaya gas field, which lies near the disputed South China Sea waters and operated by a unit of Royal Dutch Shell Plc , fuels power plants producing about 40 percent of supply for the main Luzon island.
Phoenix said the agreement with CNOOC will potentially broaden its business portfolio, which includes retailing of petroleum products, logistics services such as hauling of jet fuel for airports and airlines, and FamilyMart convenience stores.
Dozens of domestic and foreign companies were looking to get a stake in the Philippines' LNG project, including investors from China, Japan, South Korea and Russia, Energy Secretary Alfonso Cusi said in December.
Tokyo Gas Co Ltd has expressed interest while the Philippines' First Gen Corp, which owns four Malampaya gas-powered plants, has also disclosed plans to build an LNG terminal.
(Reporting by Enrico dela Cruz; additional reporting by Meng Meng in BEIJING Editing by Manolo Serapio Jr and Gopakumar Warrier)
