PH rule book for natgas dev’t out
The Department of Energy (DOE) has signed the implementing rules and regulations (IRR) for the new law that seeks to develop and prioritize the local natural gas (natgas) sector.
The agency came up with the 78-page IRR for Republic Act No. 12120, or the Philippine Natural Gas Industry Development Act, following a series of consultations with relevant government agencies, as well as stakeholders from the private sector.
Based on the released IRR, the DOE reiterated that bolstering indigenous natural gas would remain the country’s priority.
“Procurement and utilization of indigenous natural gas, including without limitation, by gas-fired power plants, shall be prioritized over imported natural gas,” the document read.
“Power produced from indigenous natural gas shall have priority over other conventional energy sources,” it added.
Transition fuel
The Malampaya gas field, the country’s only indigenous commercial source of natural gas, supplies 20 percent of Luzon’s power needs. Since starting commercial operations more than two decades ago, Malampaya has so far contributed more than $13.8 billion to the Philippine government.
The DOE also said that it would issue mechanisms requiring generation companies or distribution utilities to source a minimum percentage of their power demand from indigenous natural gas.
The mandated minimum percentage, it said, would be up for review “as may be necessary.”
In January, President Marcos signed the measure into law, where the DOE would serve as the lead agency authorized to assess, approve and issue permits for the construction, expansion, rehabilitation, operation, decommissioning, as well as abandonment of any facilities in the sector.
Energy Secretary Raphael Lotilla earlier said the measure could entice more exploration and development activities in the “largely underexplored” natural gas industry.
Energy security
Sen. Pia Cayetano, chair of the Senate committee on energy and sponsor of the bill, also said it would strengthen the country’s target of achieving energy security without relying on imported supplies that are vulnerable to price volatility.
“Historically, indigenous natural gas has been cheaper, and increasing opportunities for natural gas will only make the prices cheaper,” she said late last year.
