PROJECT
[PHOTO -
Malampaya is benefiting the Philippines in countless
ways, including reducing oil imports, assuring a more stable supply of energy
and a cleaner source of power, and meeting up to 40% of Luzon's energy
requirements. The operation of Malampaya in the power stations' full capacity of
2,700 megawatts is displacing an estimate of some 1.35 million kilograms of CO2
per hour–a cleaner and more sustainable process, as compared to energy
generation using coal or fuel oil.]
MANILA, JANUARY
20, 2012 (INQUIRER) By: Norman Bordadora - The Philippine government received $1.1 billion as its share of
the income from the Malampaya gas-to-power project.
President Benigno Aquino received the symbolic check for $1,134,669,157
representing the project's revenue contribution to the national government from
Shell Philippines country manager Edgar Chua.
The amount is equivalent to more than P43 billion.
"The project is a joint venture so that government has a share and it is
given every year. The US$1.1 billion is the total for 2011," said Energy
Secretary Jose Rene Almendras, who was among the officials who witnessed the
ceremonial turnover.
The energy secretary expressed optimism that the government will be receiving
the same return in the coming years if the price and quantity produced would be
stabilized.
"Hopefully, the supply will continue so that's the same amount of shares and
if the price stays as it is that should be the quantity that we should be
getting," Almendras said.
"The only time that it will go down is when we reinvest, because we have to
invest for the Malampaya Phase 2 and Phase 3…. There's a Phase 2 and 3 which
will require us to invest so that we can get more gas and prolong the supply of
gas because we need gas as much as we can," he added.
Almendras said the amount would go directly to the Malampaya fund managed by
the Department of Finance.
According to Budget Secretary Florencio Abad, the Malampaya Fund has a
specific purpose in law, which is to fund energy development, or for other
purposes as duly approved by the President.
"We really have to be prudent whenever charging against the Malampaya Fund
because of its impact on our fiscal health. Under the government of President
Benigno S. Aquino III, this fund will be used reasonably and rationally," Abad
said in a statement issued in May 2011 on the status of the fund.
"So far under the Aquino administration, we have charged P2.87 billion from
the fund for necessary energy-related expenditures," he said.
These expenditures as of May 2011 include P2 billion for fuel requirements of
the National Power Corporation-Small Power Utilities Group, to avert a power
shortage in off-grid areas; P450 million for the Pantawid Pasada program, as
direct support to jeepney and tricycle drivers affected by the recent spate of
oil price hikes; and P423 million for the purchase of the USS Hamilton cutter
marine vessel to strengthen the security perimeter of the Malampaya Natural Gas
Project.
According to the records of the Department of Budget and Management as of May
2011, P105.95 billion has been collected from the Malampaya proceeds since 2002.
Also as of May 2011, P26.47 billion has been disbursed so far: P3.95 billion
to the provincial government of Palawan; and P22.52 billion to national
government agencies. Out of this amount, P2.87 billion was released in 2011.
The Malampaya Deep Water Gas-to-Power project is a joint undertaking of the
Philippine government and the private sector.
The project is spearheaded by the Department of Energy, developed and
operated by Shell Philippines Exploration B.V. on behalf of joint venture
partners Chevron Malampaya LLC and the PNOC Exploration Corporation.
Also present during the ceremonies were Finance Secretary Cesar Purisima,
PNOC chair and Chief Executive Officer Gemiliano Lopez, Shell Philippines
managing director Sebastian Quinones Jr. and Shell Philippines assistant manager
Sabino Santos.
THE MALAMPAYA PROJECT: POWER FROM THE DEEP
The Malampaya Deepwater Gas-to-Power project is the first undertaking
of its kind in the Philippines employing state-of-the-art deepwater technology
to draw natural gas from deep beneath Philippine waters. The indigenous gas
fuels three natural gas-fired power stations with a total generating capacity of
2,700 megawatts to provide 40-45% of Luzon's power generation requirements.
Since October 2001, the Philippines has been importing less fuel for power
generation, providing the country foreign-exchange savings and energy security
from this clean fuel.
Natural gas has the least CO2 among fossil fuels and is more efficient than
other sources of power like coal and crude oil.
The Malampaya Project: The Big Picture
The discovery of an alternative and indigenous source of energy was a
milestone event for the Philippines, a country that has historically relied on
imported fuel for the bulk of its domestic and industrial power requirements.
The Malampaya Deep Water Gas-to-Power project is one of the largest and most
significant industrial endeavors in Philippine history. A joint undertaking of
the Philippine national government and the private sector, the project is
spearheaded by the Philippine Department of Energy (DOE) developed and operated
by Shell Philippines Exploration B.V. (SPEX) on behalf of joint venture partners
Chevron Malampaya LLC and the PNOC Exploration Corporation.
A STORY OF POWER
The Malampaya story is a story of resilience, perseverance, and innovation
spanning over a decade. In 1989, a small gas reservoir called Camago was
discovered in the area of service contract 38 (SC 38). In 1990, upon acquisition
of a 50% participating interest in SC38, SPEX joined the search for natural gas
reserves. Two years later, the Malampaya gas field was discovered, and was later
found to be connected to the Camago structure.
SPEX drilled five wells to determine the amount of gas available in
Malampaya. The findings confirmed the presence of a formidable power source 80
kilometers northwest of Palawan island–about 2.7 trillion cubic feet of natural
gas reserves and 85 million barrels of condensate, located some 3,000 meters
below sea level. In 1995, after comprehensive studies, it was concluded that
Malampaya presented an extraordinary opportunity for commercial gas development
in the Philippines.
The development of Malampaya posed a myriad of daunting logistical, social,
environmental, and financial challenges. It required the active participation
and involvement of government agencies, communities, and both Filipino and
multinational companies. The DOE played a key role in making Malampaya a
reality.
In 1998, former President Fidel V. Ramos signed the declaration of
commerciality of the venture. Three-and-a-half years later, in October 2001, the
Malampaya Deep Water Gas-to-Power Project was inaugurated in a special ceremony
at the onshore gas plant in Batangas.
The Malampaya Deep Water Gas-to-Power Project employs state-of-the-art deep
water technology to extract natural gas and condensate from the sea floor. Such
technology includes sub-sea facilities, a shallow water production platform, an
underwater pipeline, a catenary-anchored leg mooring buoy, and an onshore
processing gas plant.
THE CUSTOMERS
Power Stations:
Three combined-cycle gas turbine plants–the 1,000-megawatt Sta. Rita power
station, the 500-megawatt San Lorenzo power station, and the 1,200-megawatt
Ilijan power station–are supplied with processed natural gas to generate a
combined 2,700 megawatts of power for Luzon.
CNG Pilot Program:
Malampaya gas is utilized for the government's pilot CNG program for public
utility transport, which consists of a mother and daughter filling station
located at the onshore gas plant and at a Shell station in Laguna.
WHAT IS NATURAL GAS?
Dubbed the "fuel of the future", natural gas is composed of gaseous
hydrocarbons found deep underground, or extracted through driven wells. It is
formed beneath the earth's surface over millions of years by the decomposition
of organic matter, in much the same way that oil and coal are formed. Natural
gas is 85-90% methane, with varying amounts of ethane, propane, butane, and
other hydrocarbon compounds. Some condensate and oil will always be associated
with the gas. In its natural state, the gas is colorless, odorless, and lighter
than air.
Partners In The Vision
The Department of Energy, the agency leading the development of
Malampaya, is the Philippine government division dedicated to the search and
development of indigenous sources of energy.
Project operator Shell Philippines Exploration B.V. (SPEX) and joint
venture partners Chevron Malampaya LLC and the PNOC Exploration
Corporation are responsible for the development and operation of the project's
upstream component. Chevron, one of the world's largest global energy companies,
acquired 45% of Malampaya in 1999, while PNOC Exploration Corporation acquired
10% in 2000.
Chief News Editor: Sol Jose Vanzi
© Copyright, 2012 by PHILIPPINE HEADLINE NEWS ONLINE
All
rights reserved
PHILIPPINE
HEADLINE NEWS ONLINE [PHNO] WEBSITE
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