Expansion of RP natural gas industry urged

MANILA, Philippines - The recent Natural Gas Summit 2014 initiated by natural gas-powered countries Norway, Russia, Japan, The Netherlands, Great Britain and Spain in collaboration with the Philippines’ Department of Energy (DOE) brought together government and energy industry leaders to tackle the need for a more dynamic natural gas industry in the country, to continue powering the country’s robust economic growth which was forecasted by the International Monetary Fund (IMF) at 6.3 percent this year.

The Malampaya model

A pioneer in the country’s natural gas industry, the Malampaya Deep Water Gas-to-Power Project was cited as a model for shaping the future share of natural gas into the country’s energy mix. The birth and commercialization of Malampaya and the first natural gas policy established for the gas project were tackled in separate discussions by former DOE leaders: Dr. Francisco Viray, chief executive officer of Trans-Asia Oil and Energy Development Corp.; and Jose Victor Emmanuel de Dios, chief executive officer of General Electric.

Malampaya currently provides 30 percent of the Philippines’ energy needs with natural gas, known as the fuel for sustainable growth and development because it is abundant and cleaner than fossil fuel.

The gas project is now on its next phases of development, the Malampaya Phase 2 and 3 which will maintain the current level of gas production and further support energy security for Filipinos.

Accelerating gas investments

Speaking at the forum, Shell Philippines Exploration, B.V. (SPEX) managing director Sebastian Quiniones urged for more drilling and exploration activities for natural gas production in the country. “The Philippines is behind other Southeast Asian countries in terms of upstream exploration activities for natural gas. Only 566 wells have been drilled in the Philippines in the last 100 years, compared to 400 wells drilled in Indonesia in just one year, according to the Petroleum Association of the Philippines,” said Quiniones.

Fuelling unprecedented economic growth calls for more investments in unlocking indigenous sources of sustainable power. “The country needs some 300,000 barrels of oil per day, but local production only supplies 60,000 BOPD through the Malampaya Project and about 10,000 BOPD from other smaller projects,” explained Quiniones.

Quiniones made recommendations to government to boost natural gas investments in the country, such as developing a favorable investment climate through the elimination of bottlenecks, more fiscal incentives, consistency in policy and regulations, improved infrastructure and strengthened government interagency collaboration through the Executive Order 60 or Philippine Upstream Petroleum Task Force.

Promoting gas advocacy

Energy Secretary Carlos Jericho Petilla in his closing remarks underscored the importance of the natural gas advocacy in the country. He urged for more dialogues on natural gas to be held for it “solidifies our nation’s aspiration on developing our natural gas industry. I do hope that we have more of these sessions where we [the government] learn a lot from the private sector and the private sector will get input on where we’re going with gas.”