Production from the Malampaya natural gas field in northwest Palawan has dropped 13 percent from January to September this year, according to the Department of Energy.
“This decline was caused by the depletion of the Malampaya reserves and decreasing reservoir pressure. A decrease in reservoir pressure will decrease the quantity of gas being produced. Malampaya’s natural gas production is expected to continually decrease until the end of Malampaya field life in 2027,” Energy Secretary Alfonso Cusi said during the agency’s budget hearing.
Production from the Malampaya gas field dropped to 79,054 million standard cubic feet as of September compared with 141,732 mmcsf in 2020 based on previous DOE data. The bulk of the production this year went to power at 76,040 mmcsf.
Cusi said the service contract which covers the Malampaya gas project is set to expire by 2024. To address the decline in natural gas, Cusi said the DOE issued DC 2017-11-0012 or the “Rules and Regulations Governing the Philippine Downstream Natural Gas Industry” that would facilitate the entry of LNG terminals in the country.
“Our foresight assures that the existing natural gas power plants will be fueled from the expected commercial operation of the AGP and First Gen LNG facilities in the second and third quarters of 2022, respectively,” the energy chief said.
He said AG&P would provide the LNG storage and re-gasification services for the 1,200-megawatt Ilijan power plant, while the First Gen terminal would take care of the supply requirements of the Sta. Rita, San Lorenzo, San Gabriel and Avion natural gas plants.
“Developing our LNG sector will help us attain energy security, while supporting the objectives of the Clean Energy Scenario indicated in our Philippine Energy Plan 2020-2040,” Cusi said.
He said the DOE approved the permits of six proposed LNG regasification terminal projects, including the two AG&P and First Gen LNG projects, which were expected to begin operations from 2022 to 2023.
“Total investment from these proposed LNG regasification projects is estimated at P51.2 billion. When completed, these LNG facilities will provide the country with an aggregate capacity of 21.66 million tons per annum for the gas supply requirements ready for the anticipated new natural gas power plants in our Philippine Energy Plan 2020-2040,” he said.