MANILA -The Philippines is expected to import more liquefied petroleum gas (LPG) this year as local production continues to slow down amid increasing demand among residential and commercial consumers, according to think tank Fitch Solutions through its unit BMI.
BMI’s research said the country would likely import 55,000 barrels per day (b/d) of LPG this year, up from 51,000 b/d in 2022.
The study found that Petron Corp.’s Bataan refinery, the exclusive producer and supplier of LPG for domestic consumption, was unlikely to increase production “even if Petron intends to maximize LPG production in the longer term.”
“Lack of gas processing plants to produce LPG further exacerbated shortages in domestic LPG supply,” BMI noted.
LPG demand in the Philippines is projected to increase to nearly 70,000 b/d this year from almost 60,000 b/d in 2022.
However, Fitch explained that refinery LPG production in the country only averaged at around 8,000 b/d between 2015 and 2022.
More households switch
Last year, the residential and commercial sectors consumed more than 89 percent of the country’s total demand, and this is expected to grow further to 92 percent this year as more households switch to LPG as a clean fuel for cooking purposes, BMI said.
The transport sector, meanwhile, consumes only a small fraction of the total, as demand dropped to below 100 b/d in 2022 from 1,200 b/d in 2015.
“The dynamics of LPG import market in the Philippines is changing fast with many industry players participating in import, wholesale and retail areas,” BMI said.
“LPG is one of the more promising energy sources poised for growth in the longer term because the country does not have many alternatives other than imported [cooking gas],” it added, noting that the
Philippines was emerging as the second-largest LPG importer in Southeast Asia.
The country currently has close to 14,000 LPG refilling stations, up from 7,655 in 2020. INQ