THE Department of Energy (DOE) should fast-track the development of new indigenous energy sources to ensure a stable long-term energy supply for the country given the inevitable closure of the Malampaya gas facility, Senate energy committee chairman Sherwin Gatchalian said on Monday.
The Malampaya gas facility is set to close when its service contract expires in 2024.
It is operated by a consortium composed of Shell Philippines Exploration B.V. as operator with a 45 percent stake, Chevron Malampaya LLC also with a 45 percent stake, and PNOC Exploration Corp. with 10 percent.
The consortium owns Service Contract 38, which covers the Malampaya gas field located in the West Philippine Sea northwest of Palawan. The consortium had requested an extension of the contract with the previous administration.
Gatchalian noted that even if the government decides to extend the life of the Malampaya contract, the gas field is projected to be completely depleted by 2030.
“The government must redouble its efforts in exploring and developing new energy sources. The government must find a way to fill the void that will be left in the wake of Malampaya’s depletion. Failing to do so would result in a catastrophic energy crisis of a magnitude that this country has not witnessed since the so-called Dark Ages of the first Aquino administration,” Gatchalian said in a statement.
Gatchalian pointed out that Malampaya is currently responsible for approximately 2,700 megawatts (MW) of installed energy generating capacity.
“Unless we find new indigenous natural gas deposits or develop the capacity to import and process natural gas, we stand to lose a tremendous amount of energy generation capacity. The failure to find viable alternatives to Malampaya will compromise our energy supply stability in the coming decades,” Gatchalian said.
Meanwhile, DOE Energy Secretary Alfonso G. Cusi said earlier that the government plans to develop the Philippines’ first liquefied natural gas (LNG) terminal to support the operation of the Malampaya gas project in northwest Palawan, if the service contract of the Malampaya consortium is not extended.
“Malampaya (consortium) should initiate the renewal if they want to renew because at the end of the term, it reverts back to the government. What we are doing is preparing for any eventuality,” Cusi said.
Cusi said the DOE is making preparations to ensure the continuity of operations of the Malampaya facility, which supplies fuel to three natural gas power plants in Batangas with a combined capacity of 2,700 MW.
“We will make that LNG farm in Batangas to supply gas-to-power plants. We PNOC (state-owned Philippine National Oil Co.) initiated the study but now, there is a lot of interest in the private sector. We are open to that. Whatever is best for the country, that’s the direction we will take,” Cusi said.
He said the department was studying all options, including privatizing the Malampaya facility if the service contract is not renewed.