Energy
From The Report: The Philippines 2015
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With large, easily accessible oil and gas discoveries long since picked over, a continued decline in petroleum production has encouraged a heavy reliance on foreign imports. While new exploration blocks offered up in 2013 could provide potential for more technically challenging opportunities in the coming years, the majority of the coveted offshore areas remain off-limited due to acrimonious territorial disputes. Exploration in new, primarily frontier areas could mitigate the country’s increasing reliance on foreign energy sources to some degree. As the Philippines, along with the rest of the global energy market as a whole, shifts its energy priorities away from crude oil and towards cleaner, more plentiful natural gas, the Department of Energy has set out a road map to establish a new network of gas pipelines to transport gas around Luzon from 2017 to 2022.

This chapter contains interviews with Edgar O Chua, Country Chairman, Shell Companies in the Philippines; and Francis Giles B Puno, President & COO, First Gen Corporation.

Articles from this Chapter

Overview

Watts next?: With oil production set to remain flat, a shift to new sources is seen as necessary to reduce dependence on foreign imports
OBG
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Strong economic growth and a rise in energy demand have exerted pressure on the Philippines’ energy sector in recent years. With large, easily accessible oil and gas discoveries long since picked over, a continued decline in petroleum production has encouraged a heavy reliance on imports. The substantial reserves in the Malampaya gas fields have given rise to a resurgence in domestic production, although output is expected to dwindle over the next 15 years. While new exploration blocks offered…

Analysis

Stemming the tide: Diplomatic disagreements have overshadowed the opportunities opened up by the exploration of new territory
OBG
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While hydrocarbons production in the Philippines has declined in recent decades, the exploration of new territory holds the potential to stave off dependence on foreign imports, if not reverse the trend altogether. Unfortunately, a host of obstacles will need to be overcome in order to achieve any significant improvement even in the short-to-medium term. Among the most relevant of these challenges are the profitability of marginal fields in the current energy market, adherence to strict requirements…

Interview

Fuelling growth: OBG talks to Edgar O Chua, Country Chairman, Shell Companies in the Philippines
OBG
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How will a liquefied natural gas (LNG) import terminal help the Philippines meet its energy security goals and develop the local natural gas industry? CHUA: Natural gas is abundant and is the cleanest-burning fossil fuel, emitting about 50% of the CO released by coal-fired power generation and can be used across multiple sectors, ranging from road transport to the marine industry, residential and power. Based on International Energy Agency (IEA) analysis, there are sufficient technically recoverable…

Interview

In a sustainable fashion: OBG talks to Francis Giles B Puno, President and COO, First Gen Corporation
OBG
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To what extent will the award of the feed-in-tariff (FIT) encourage investment in renewable energy? PUNO: As a country, the Philippine needs to acknowledge it is not rich in fossil fuels, but in renewable energy, and promote an environment where renewables play a greater role in the energy mix. The DoE’s approach in awarding the FIT on a first-come-first-served basis was unconventional, as it generated a race to build capacity by those hoping to receive the FIT. The new regime attracts investors…

Analysis

Power outage: Generation capacity has not kept pace with economic growth, leading to potential shortfalls
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As the economy has continued its robust growth over the past decade, and spending among the expanding middle class has increased, demand for electricity has risen accordingly. However, while sales have gone up by an annual average of 3.89% from 2001-13, according to the Department of Energy (DoE), power generation capacity growth has lagged far behind, at 2.2%. CAPACITY CONCERNS: Taking into account DoE assumptions of electricity demand-to-economy elasticity in Luzon of 0.6, the country’s…

Analysis

Opening up: Renewable energy has enjoyed its most productive year to date
OBG
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Forces coalesced in 2014 to grant the Philippines’ renewable energy industry its most productive year to date. Spurred on by mounting concerns over the looming energy shortfall, the Energy Regulatory Commission (ERC) has opened the sector to investment by boosting the renewable capacity approved for the renewable energy incentive scheme ten-fold in many cases. However, with solar, wind, biomass and small hydro contributing only 153 MW of installed capacity at end-2013, further investment will…