The Department of Energy (DOE) revealed that the Philippines still have unexplored potential gas fields that will help succor the energy requirements of the country.
DOE Energy Resource Development and Oil Management Division Undersecretary Alessandro Sales mentioned that interested investors can still explore the country’s oil and gas to utilize these potential power sources.
“Marami pang mga lugar, hindi lang po Malampaya, ang mayroong mga potential para sa malalaking gas deposit,” Sales said.
However, he highlighted that the unresolved income tax case involving the Malampaya gas project has created a deterrent for potential investors.
“Ito iyong kaso ng income tax ng mga service contractor.T Hanggang ngayon, hindi pa ito nare-resolve at nagiging malaking ‘overhang’ sa mga potential investors,” Sales further clarified. The taxation issue arose from the Commission on Audit (COA)’s interpretation that the income tax payment of the Malampaya consortium shouldn’t be part of the government’s 60% royalty share.
The Malampaya consortium currently consists of Prime Energy Resources Development, PNOC Exploration Corporation, and UC38 LLC.
Additionally, the government is encouraging upstream exploration and production of oil and gas notwithstanding the country’s pledge to decarbonization.
“The path to decarbonization ay hindi iisa. What works for other jurisdictions does not necessarily apply to the Philippines,” he said.
President Ferdinand Marcos Jr. earlier signed the 15-year renewal agreement for the Malampaya Service Contract No. 38 (SC 38), extending Malampaya’s contract until 2039.
To access the remaining gas reserve beyond 2024, it is essential for the government to finalize the contract renewal for the project.
“It’s about 80 to 140 BCF (billion cubic feet) that would have been stranded if the contract was not renewed. In the renewal agreement, it is also required that the consortium conduct near-field appraisal and development. This is to add reserves and increase the production of the Malampaya field,” he added.
The objective of the Malampaya Project is to decrease the Philippines’ dependence on imported oil and ensure a stable energy supply from a domestic source.