In Asia, Shell’s prospects now appear rosier

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12:46 AM December 7th, 2012

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December 7th, 2012 12:46 AM

Royal Dutch Shell Plc sees the Philippines as one of Asia’s more attractive markets where it can supply natural gas to cater to the rising global demand for alternative fuels.

In a global webcast late Wednesday, Shell director for upstream international Andy Brown explained that Asia could expect a significant increase in the demand for liquefied natural gas (LNG) which would, in turn, drum up opportunities for the company’s vast gas portfolio across Australia, East Africa and North America.

Brown said the company is looking forward to opportunities now opening up in Asia, where alternative fuel demand is expected to surge not just in Korea and Japan, but in most other parts, particularly China.

He cited Singapore, Vietnam, Malaysia and Indonesia as some of the countries now attracted to LNG, considering it to be a logical alternative to coal in generating power and fueling vehicles for transport.

Now that the country is on the radar of the world’s largest supplier of LNG, it may become easier for the Philippine government to push its own alternative fuel agenda.

Being a net importer of oil, the Philippines is highly vulnerable to volatilities since it sources more than 90 percent of its requirements abroad. As a result, the government has turned its attention to natural gas, believing it to be a more feasible alternative that will allow the country to diversify its energy and transport fuel sources.

In the local upstream oil industry, Shell, through Shell Philippines Exploration BV, is infusing another $1 billion into the $4.5-billion Malampaya gas field off Palawan to extend its production life. This field currently supplies natural gas to three power facilities in Batangas, generating 2,700 MW, or roughly 40 percent of the requirements of the Luzon grid.

Shell Companies in the Philippines is also completing a feasibility study to determine the viability of putting up an LNG terminal hub near its refinery in Tabangao, Batangas. Should Shell push through with this project, the company would invest another $1 billion.—Amy R. Remo

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