First Gen: P50 billion gas deal a ‘correct choice’

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May 14, 2026 | 12:00am

MANILA, Philippines — Despite the controversy over a P50-billion deal with Prime Infra, a top executive of First Gen Corp. maintained that selling the majority stake in the gas business was the “correct choice.”

Although the move was difficult, First Gen president and COO Francis Giles Puno said allowing Prime Infrastructure Capital Inc. to take over the Lopez Group’s gas portfolio was the right course for the business.

“In the context of gas development, nothing can come close to our joint venture in Batangas,” Puno said at the energy summit organized by the Philippine Chamber of Commerce and Industry.

Prime Infra assumed control of First Gen’s gas business in November 2025 after acquiring a 60-percent stake in four gas-fired facilities totaling over 2,000 megawatts and the proposed 1,200-MW Santa Maria gas plant in Batangas.

First Gen retains a 40 percent ownership to ensure continuity and stable operations of the projects.

The deal also involved the sale of a 60-percent interest in an offshore liquefied natural gas (LNG) terminal in Batangas, leaving First Gen with only 20 percent.

While the synergy between First Gen and Prime Infra was strategic on paper, the transaction has remained entangled in the ongoing Lopez family dispute.

The Lopez family majority, representing three branches of the clan, has described the deal as a so-called “poison pill,” arguing that it is closely tied to the leadership of First Gen chairman Federico ‘Piki’ Lopez.

According to the majority, the provision would allow Prime Infra to buy out First Gen’s gas business at a 25-percent discount.

Despite concerns surrounding the deal, Puno said the joint venture provides certainty for the gas plants, which have long been supplied by the Malampaya gas field operated by Prime Infra unit Prime Energy.

“In today’s market, to run fully on LNG is the most expensive option,” Puno added. “In our case, we run a mix of Malampaya and LNG. It’ll be cheaper than the alternative ones that are running fully on LNG.”

Natural gas is deemed a “transition fuel” to help the country shift away from coal-fired power plants while paving the way for a wider adoption of renewable energy in the long term.

For Prime CoreGen, a Prime Infra subsidiary created to manage its acquired gas assets, natural gas is essential to the country’s power mix as a reliable source of mid-merit supply.

“I do appreciate the fact that the Department of Energy appreciates this nuance of gas generation because there is such a thing as a mid-merit role that gas plays in your demand-supply profile,” Prime CoreGen president and CEO Jose Victor Emmanuel de Dios said.

Mid-merit capacities bridge the gap between peak and base generation sources.