Lorenzo revealed the Presidents plan after the presidential announcement that the Office of the Secretary of the Department of Agriculture will be transferred to Davao City and not here as earlier planned.
The possible site of the defense department will be the Cabatangan Complex, which was formerly occupied by the renegades of jailed Muslim leader Nur Misuari, Lorenzo said.
The more than 10-hectare property is overlooking the entire city, the Philippine Air Forces (PAF) Edwin Andrews Air Base (EAAB) and the Armed Forces Southern Command, the largest military command outside Manila.
"The President thought that this location is very strategic specially at this time of challenges relative to terrorist threats," Lorenzo said during his visit here.
The Brussels-based International Crisis Group (ICG) in its report cited the existing presence of the Indonesia-based militant group Jemaah Islamiyah (JI) in some of the Moro Islamic Liberation Front (MILF) camps in Central Mindanao.
The JI group was also believed to have established a training center within Camp Abubakar.
Although the MILF leadership repeatedly denied reports that it has links with the JI, the training camp was described in 1998 as a full-fledged academy with an officer cadet training course known as Kuliah Harbiyah Dauroh-1 or KHD-1, allegedly a project of the markaziyah (JI Central Command).