Palawan-Sabah gas pipeline proposed

The Philippines and Malaysia are exploring the possibility of building a Sabah-Palawan gas pipeline in preparation for the commercial production of natural gas in northern Palawan by October this year.

Philippine National Oil Co.-Exploration Co. (PNOC-EC) president Rufino Bomasang said the proposed project will be undertaken by his company and Malaysia’s state-owned oil company, Petronas.

Bomasang said the Malaysian government will be sending representatives to the Philippines to discuss the proposal.

"They are sending a delegation, if not in late April, in early May," Bomasang said, adding that Energy Secretary Jose Isidro Camacho would be requested to spearhead the discussions with the Malaysian delegates.

The proposed gas pipeline, Bomasang said, forms part of an ASEAN initiative to link the natural gas markets in the region through Trans-ASEAN Gas Pipeline (TAGP).

Shell Philippines Exploration B.V. (Spex), 45-percent owner and a main operator of the Malampaya project, is expected to start supplying natural gas to three power generating plants in Batangas by October this year. Aside from Spex, the other proponents of the Malampaya natural gas project are PNOC-EC, with a 10-percent share, and Texaco of US, with a 45-percent stake.

Spex is a member of the Royal Dutch Shell Group that also runs concessions on some offshore Sabah gas fields which have not yet been commercially developed.

"The fact that you have the Malampaya to Luzon pipeline enhances the feasibility of having a pipeline from Malampaya all the way to Sabah. It really makes sense, particularly for the Philippines and Malaysia, even without thinking of the big Trans-ASEAN Gas Pipeline, to look at an interconnection between Sabah and Palawan," Bomasang said.

He said, PNOC-EC and Petronas are planning to acquire a stake an equity in a proposed onshore natural gas pipeline to bring the Malampaya gas all the way to Manila.

He said the DOE is also looking at the possibility of building an onshore pipeline from Batangas to Manila and to other points of Luzon.