The Malampaya gas field has resumed supplying fuel to natural gas plants, the Department of Energy (DoE) said on Tuesday.
But Energy Secretary Alfonso Cusi has asked Shell Philippines Exploration B.V. (SPEX), operator of the Malampaya facility, to explain the gas restrictions, noting its impact on power rates.
"The Department of Energy (DoE) received information from the Malampaya Consortium operator that the gas restrictions will be lifted by today. However, higher prices may already adversely impact the consumers," said Cusi in a statement.
Likewise, the Energy chief asked the Independent Electricity Market Operator of the Philippines (IEMOP) to simulate the impact on prices of these gas restrictions, as well as the upcoming Malampaya maintenance shutdown scheduled for October 2 to 22.
"These restrictions affect the electricity prices that consumers pay and they will have to be informed on the causes of price increases," Cusi said.
"While there is sufficient supply of electricity during this period, consumers need to know the effects of all these to their power bills," he added.
The DoE is set to call a coordination meeting with the consortium operator, natural gas power plants, Manila Electric Co. (Meralco), and market operator, among the other industry players, to address all the issues and the upcoming Malampaya maintenance shutdown.
The agency noted although its 2018 policy on competitive selection process has a "no pass-on" provision, the contractual arrangements between First Gen and Meralco are "covered by previous power supply contracts" signed by the power distributor.
"Meralco's notification to the public, through its spokesperson, requires more details. Are these part of the previous contracts that it signed with suppliers? Perhaps it can also suggest to consumers on additional information to help alleviate their plight," said Cusi.
Last September 11, the Malampaya field stopped supplying gas to First Gen Corp.'s natural gas plants in Batangas.
The Lopez-led company said in a disclosure that "the Santa Rita and San Lorenzo plants have been operating using condensate as fuel while Avion has been using diesel."
Its San Gabriel plant, however, does not have dual-fuel capability and was forced to cease operations because of the absence of natural gas supply from Malampaya.
But First Gen said they received an advice from the Malampaya consortium that "they expect to slowly start supplying gas from Malampaya to the FGCEC (First Gen Clean Energy Complex) today (Sept. 14, 2021)."
The Malampaya deep water gas-to-power project fuels about 21 percent of the country's electricity requirement