A House leader has expressed hope that Manila and Beijing can somehow reach a “modus vivendi” to would pave the way for the development of the Sampaguita natural gas discovery in offshore West Palawan.
“The Sampaguita gas discovery is vital to our future energy security. It has become absolutely imperative for us to quickly develop Sampaguita, before Malampaya’s gas production starts to fall off in 2024,” said House senior deputy minority leader Buhay Rep. Lito Atienza.
“We really wish that the Philippines and China, through effective diplomacy, can arrive at a mutually acceptable arrangement that would expedite the resumption of all work around Sampaguita,” he added.
The now 16-year-old Malampaya deepwater gas-to-power project still generates up to 3,400 megawatts of electricity for the Luzon grid.
However, Energy officials told a recent Senate hearing that by 2024, Malampaya’s gas output would fall to just one-third of current capacity.
This implies that six years from now, Malampaya’s diminishing gas reserves would be able to produce just 1,100 MW of electricity for Luzon, Atienza said.
“Clearly, if we are unable to harness the gas from Sampaguita in time, Metro Manila and its surrounding provinces might reel from considerably higher electricity rates,” Atienza said.
Based on an independent assessment by Weatherford Petroleum Consultants, the Sampaguita gas field “is estimated to contain 2.6 trillion cubic feet of in-place contingent resources and 5.5 trillion cubic feet of in-place prospective resources.”
Sampaguita forms part of Service Contract 72 Recto Bank in offshore West Palawan—in territorial waters challenged by China.
The Aquino administration in December 2014 ordered the private consortium operating SC 72 to suspend all work in deference to the maritime case that the Philippines filed against China before The Hague-based Permanent Court of Arbitration.
The PCA eventually ruled in 2016 that Recto Bank, where SC 72 lies, is within the Philippines’ Exclusive Economic Zone, as defined under the United Nations Convention on the Law of the Sea.
However, even with the favorable PCA ruling, the Energy department has not lifted the suspension of all work on SC 72.