Malampaya’s gas production seen falling to a third by 2024

By Alena Mae S. Flores – April 26, 2018 at 09:45 pm

Production at the Malampaya deepwater gas-to-power project in northwest Palawan is seen to plummet to a third of its current capacity by 2024, an energy official said Thursday.

Energy Undersecretary Donato Marcos said from the current national gas production that supports power plants with a combined capacity of 3,400 megawatts, Malampaya’s output would decline to 1,000 MW by 2024.

“After 2024, Malampaya can supply 1,000 MW only,” Energy Undersecretary Donato Marcos said during a hearing by the Senate energy committee.

Marcos said the agency started making preparations for Malampaya’s eventual depletion by 2027 to 2029 and would make a decision on the life of the Malampaya consortium, operator of service contract 38 or the Malampaya gas field, by next year.

“[We] will make recommendation in 2019 and the secretary [Alfonso Cusi] will have to do some validations,” Marcos said.

Shell Philippines Exploration B.V owns 45 percent of the Malampaya consortium together with Chevron Malampaya Llc with 45 percent and state-owned PNOC Exploration Corp. with 10 percent.

Spex managing director Don Paulino said that based on the consortium’s assessment, the Malampaya reservoir could last until 2027 to 2029, “depending on the demand in the next coming years.”

“We also see opportunities that we can continue to provide between 60 percent to 100 percent of the current demand for natural gas by 2022,” Paulino said.

He said a decline in natural gas production was seen as early as 2015, prompting the consortium to install a depletion compressor to bring back the output of the wells.

The Malampaya gas field currently has seven producing wells. “So we installed a depletion compressor that brought back the output of the well, allowing us to recover 80 percent of the reservoir until 2027 to 2029,” he said.

He said the Malampaya gas field was now being maximized.

Energy Secretary Alfonso Cusi earlier said government would still aggressively pursue its planned $2-billion integrated liquefied natural gas facility even if there was still available gas from Malampaya beyond 2024.

Cusi said he wanted the Philippines to become a hub of LNG in Southeast Asia.

He said the government aimed to roll out the Batangas LNG terminal by 2020 to safeguard against the anticipated depletion of the Malampaya gas facility.