THE ENERGY department expects to receive within the week preliminary results of a study being conducted by foreign funding agencies on the country’s potential demand for liquefied natural gas (LNG), a senior official said on Tuesday.
The study is being conducted by Japan International Cooperation Agency (JICA), Asian Development Bank (ADB) and the World Bank.
“I’m supposed to receive this week the preliminary report of JICA. But this is only the first report for Luzon. It is not yet final because this only has the input of JICA,” said Energy Undersecretary Jose M. Layug, Jr.
The Energy department has said it plans to draw up an LNG industry development master plan which it will use to plan regassification terminals and pipelines as part of government plans to beef up use of alternative fuels.
“What we need to see is validation of supply-and-demand statistics because part of what JICA did is go to different industrial zones and ask them what is the potential for gas use,” Mr. Layug explained.
He added that the study will also inform the government how much LNG will be needed to meet the economy’s growing electricity demand.
The Philippines now uses natural gas from the Malampaya project in waters off Palawan to provide for part of Luzon’s power requirement, but deposits there are expected to run out in the next few years, prompting the Energy department to say earlier this month that the country may have to import LNG in four to five years.
The department has also been pushing the Batangas-Manila (BatMan1) natural gas pipeline project. The entire system consists of a 100-kilometer pipeline that will course gas from the Malampaya fields to Bataan, as well as LNG terminal and a 600-megawatt power plant.
But an unsolicited proposal to build the pipeline for $1.2 billion was rejected by the Philippine National Oil Co. in September last year on questions of the proponent’s capability to carry out the project.
A second planned pipeline, called BatMan 2, will run from Bataan to Manila.
Mr. Layug said it is important to start building this infrastructure soon in order to support wider use of this new resource.
At the same time, the Energy department is also looking to add more coal exploration areas to the auction bloc by the end of next month.
“So far, we have only five areas, but we are looking at I think additional five more,” Mr. Layug said, noting that many of these areas are in Mindanao.
The auction scheduled next month forms part of the Philippine Energy Contracting Round that will offer coal exploration areas to investors.
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By: ENJD
Source: Business World, Sept. 27, 2011
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