Validation of Malampaya report sought
The Department of Energy wants the remaining excess gas in the Malampaya natural gas field off Palawan verified again, following a report showing a volume that is lower than earlier estimated.
Earlier reports indicated that the excess gas in the field was enough to generate 300 megawatts of power. However, the consortium operating the project recently reported that the volume in the field could generate only 150 MW of power.
Energy Secretary Jose Rene D. Almendras said the recent report was submitted by Shell Philippines Exploration BV (SPEx), operator of Service Contract 38, which covered the Malampaya project.
In a recent briefing, Almendras said he had already asked the two other members of the consortium—Chevron and PNOC Exploration Corp.—to conduct separate studies to revalidate the findings. SPEx is also being asked to reassess the excess gas in the Malampaya.
“There has to be a validation of certain assumptions. I met with the consortium already. I’m asking for another look. It’s not as much as I thought it would be. I want more (natural gas) if possible,” Almendras said.
The energy chief has since been wanting to bid out the Malampaya excess gas considering the big number of investors who had expressed interest in building natural gas-fed generation facilities in the country.
The government has been trying to boost the local natural gas industry as it wanted to tap natural gas for the country’s energy needs and provide cleaner fuel for public utility vehicles.
SPEx, Chevron and PNOC EC have to submit their respective findings to the DoE before the end of July, after which the SC 38 consortium will be mandated by the government to auction off the excess gas, said Energy Undersecretary Jose M. Layug.
“We need to make sure that whatever volume of (excess) gas we will sell will not affect the existing contracts. We have three (natural gas-fired) power plants (using the gas from Malampaya), so we have committed volumes. We don’t want to unnecessarily oversell because that will affect the existing gas sales contracts,” Layug said.
Two years ago, SPEx conducted a bidding for the sale of the excess gas, but the auction failed. Recently, however, several firms were reported to be keen on the gas, including Chevron Philippines, PNOC EC, Singapore-based Callandra LCNG Fuels Corp. and the Lopez-led First Gen Corp.
With an estimated capacity to power up to 3,000 MW until 2024, the $4.5-billion Malampaya deep water gas-to-power project supplies natural gas to the 1,200-MW Ilijan plant of Korea Electric Power Corp. (Kepco), 1,000-MW Sta. Rita and 500-MW San Lorenzo plants, all in Batangas.
The excess capacity of about 300 MW was initially intended for the San Pascual co-generation project of a consortium led by Edison Mission Energy. This project, however, did not push through.
