Volatile market a reminder to PH to rely on indigenous natural gas
Malampaya provides a certain degree of energy security to the Philippines. Besides, LNG is a much cleaner fossil fuel than oil and coal.
WITH the Ukraine-Russia war becoming a protracted struggle and the Middle East conflict nowhere close to a resolution, the international market for commodities, especially oil and liquified natural gas (LNG), remains on a roller coaster.
Oil and gas prices gyrate at every news of the conflicts on the other side of the world. It is understandable for market traders to be nervous on geopolitical developments. Russia and Ukraine are major natural gas producers while Iran is a key member of the Organization of Petroleum Exporting Countries.
A disruption in the supply from these major oil and gas producers will predictably raise the prices of these two commodities and wreak havoc on the global economy. Reducing the dependence on these producers, thus, will be the key to insulating an economy but it is not that easy—especially for importing nations with no indigenous resources.
Fortunately, the Philippines has the Malampaya natural gas field that has been feeding big power plants in Batangas province. The Malampaya field may not be as huge as those found in the Gulf of Thailand, North Sea in northern Europe and the vast lands of Ukraine, Russia and the Middle East. But Malampaya’s output in LNG form has been instrumental in providing fuel to our gas-fired plants in Southern Luzon
Malampaya provides a certain degree of energy security to the Philippines. Besides, LNG is a much cleaner fossil fuel than oil and coal.
Prioritizing the Malampaya gas supply over imported LNG should be the order of the day. The Senate took notice of this. A bill is now pending at the Senate to reduce the nation’s dependence on imported fuel and offer energy security.
Contrary to the claims of certain critics, the Malampaya gas field’s potential to yield more natural gas through the drilling of new wells is real and high. The bright prospects earlier prompted the Department of Energy to renew Service Contract 38, which includes the Malampaya gas field, until 2039.
The gas field already feeds 20 percent of Luzon’s electricity needs, powering industries and trade with indigenous fuel that equates to zero importation cost and delivers billions of millions in revenue to the government on a regular basis.
Developing our gas fields further will protect us from the volatility of the world market for natural gas because the chances of supply disruption are real and not imagined, not to mention the higher freight cost in shipping imported LNG.
Senate Bill 2247 of Senator Raffy Tulfo offers answers to ride us through the fickle market. The bill proposes to institutionalize the development and operation of the Philippines’ natural gas wealth.
The bill hopefully will mandate the Department of Energy (DOE) to lay down rules making the use of natural gas found and developed in the Philippines a priority in the generation of electricity.
Senato Tulfo’s bill makes sense against the backdrop of an unpredictable imported LNG market, and clears the road for investors to confidently exploit the resources of the Philippines
The indigenous gas supply now is saving the Philippines billions of dollars in importation cost and protecting it from fluctuations in the world LNG market.
SB 2247 will put things in perspective insofar as exploiting our natural resources is concerned. We hope lawmakers will have the foresight to see the real potential of the Philippines of having its own supply and system to deliver zero-importation cost natural gas to the energy grid.
Natural gas, meanwhile, is a cleaner fuel that will help the Philippines transition to renewable sources.
Burning natural gas, according to scientists, produces less carbon dioxide per unit of energy, or about half compared to the best coal technology.
Environmentalists have long described natural gas as a good stepping stone for a world looking to replace coal with renewable energy. It is a stand-in for dirty fuels, like coal and oil.
Natural gas already replaced dirty coal as the fuel of choice for electricity production, given the former’s climate and air quality benefits.