“The new law will illuminate the path to fuel self-sufficiency.”
At last, the nation can now move one step closer to ending our longstanding dependence on imported fuel. That’s because the Senate already passed on third reading on Monday (November 11) a landmark measure establishing a framework for the development of the country’s natural gas industry.
Senate Bill (SB) No. 2793, or the Philippine Natural Gas Industry Development Act, seeks to establish the Philippine Downstream Natural Gas Industry and develop natural gas as a reliable fuel for power plants, while progressively transitioning to renewable energy sources.
The bill, authored by Sen. Pia Cayetano, chairperson of the Committee on Energy, seeks to increase the share of natural gas in the energy mix but with locally sourced gas given priority in power supply contracts. It likewise offers incentives to boost investments in the Philippine natural gas industry.
The lawmaker actively worked to convince her colleagues that her pet bill would drastically reduce, if not eliminate, the country’s current dependence on imported fuel. It is also seen to stabilize energy costs. In her explanatory note, she explained that her bill offers “a unique opportunity to promote indigenous natural gas, which is cheaper, cleaner, and serves as a transition fuel as the Philippines shifts toward renewable energy.”
But what is natural gas that SB 2793 wants to make available in larger amounts?
Natural gas is a naturally occurring mixture of gaseous hydrocarbons consisting primarily of methane (95 percent) in addition to various smaller amounts of other substances. It is formed when layers of organic matter (primarily marine microorganisms) decompose under anaerobic conditions and are subjected to intense heat and pressure underground over millions of years. When burned for heating or electricity generation, natural gas emits fewer toxic air pollutants, less carbon dioxide, and almost no particulate matter compared to other fossil and biomass fuels. Cayetano, in defense of SB 2793, asked: “Why are we heavily dependent on imported fuel when we have our own?”
It’s a valid question, no doubt about it. In the 1990s, there were more than 100 projects to explore Philippine waters and other sites for natural gas. The decisive moment came when a substantial deposit of natural gas was discovered in Malampaya off the province of Palawan.
But, as Cayetano lamented, the exploration projects all stopped following the Malampaya discovery on the mistaken notion that the wells could produce natural gas for a long, long time.
With efforts to find more natural gas deposits in Philippine territory, although supported by scientific findings, having been abandoned, what should be done?
Since there is no clear-cut policy framework nor an incentive, let alone official government recognition at all of the potential investments and benefits that more natural gas exploration will bring, SB 2793 seeks to do just the opposite.
Investors would naturally fear and loathe the idea of spending good money in a venture that does not guarantee good returns. Since the development of indigenous gas is backed by scientific studies, it is actually an attractive investment target.
SB 2793 would provide the ideal conditions for the development of indigenous natural gas to proceed at a faster rate. In the first place, the landmark legislation would fill the void of government policy on natural gas development.
As Cayetano has pointed out, while the government recognizes natural gas as a transition fuel to full renewable energy use, there’s barely any recognition, much less a clear push, to develop the Philippines’ own natural gas supply.
The lawmaker is convinced that if the government opens the floodgates for investors to go all-out in exploration of natural gas in various parts of the country, this would transform many remote communities and reduce poverty incidence in the countryside.
Cayetano believes there are plenty of legitimate investors, or those who have the resources to spend but with the wisdom to know the difference between business risks and bad judgment, who can be encouraged to take a more active part in the development of indigenous natural gas. SB 2793 will bring about a paradigm shift in the natural gas industry, especially in the development of our own energy supply.
Moreover, SB 2793 will illuminate the path to fuel self-sufficiency, which is essential to stable power supply and lower energy costs, while helping accelerate over-all economic growth over the long-term.
ernhil@yahoo.com
