DOE wooing more LNG investors as Malampaya supply dwindles


With the Malampaya gas field’s reserves dwindling, the Department of Energy (DOE) is continuing to convince companies to invest liquefied natural gas (LNG) opportunities in the Philippines.

Speaking at the 2nd LNG and Clean Energy and Investment summit, Energy Asec. Leonido Pulido III pointed out that natural gas currently provides for 3,200 megawatts (MW) of electricity or 21.1% of the country’s power sources as of 2019. But in Luzon alone, natural gas’ accounted for 29.3%.

Given the figures, Pulido emphasized to over 200 leading industry executives and experts that the country is fast tracking the development of the LNG industry and that it is now ripe for investment.

“With Malampaya’s depletion estimated to occur in the next few years, there is an urgent need to attract more investments in the downstream LNG industry,” Pulido stressed.

The energy official, however, explained that the Philippines’ natural gas sector essentially is all about Malampaya, the country’s major source of indigenous natural gas. Unfortunately, its reserves are expected to be depleted by 2027. The Malampaya consortium’s Service Contract 38, meanwhile, will expire in 2024. Talks for its extension are underway.

At present, the country has five existing LNG power plants, all of which are in Batangas and source their fuel from Malampaya via an undersea pipeline.

Given Malampaya’s situation, the DOE has approved the permits of five proposed LNG regasification terminal projects targeted for operation from 2022 to 2025. Texas-based Excelerate Energy L.P., Lucio Tan’s Batangas Clean Energy Inc., and Atlantic Gulf & Pacific Company of Manila, Inc.were issued with their respective Notices to Proceed. Meanwhile, Lopez-owned First Gen Corporation and Energy World Gas Operations Philippines Inc. were issued Permits to Construct.

“The timely implementation of these proposed LNG projects shall facilitate for the entry of LNG in the country. We will also be attaining energy security for natural gas not only for power generation requirements, but also for other potential applications of natural gas in industrial, commercial, residential and transport sectors,” Pulido said.