MANILA — A group of energy advocates have formed the Philippine Energy Independence Council (PEIC) whose main goal is to move both the government and the private sector to explore new indigenous, renewable, and cleaner energy options for the country.
The PEIC seeks to initiate and sustain public discourses on energy reserve issues with the specific goal of pushing for the country’s eventual energy independence.
The Philippines is falling behind its Southeast Asian neighbors in terms of energy independence as the country continues to rely heavily on oil and gas imports while energy demand continues to increase.
On September 3, energy leaders from the Philippines and other Southeast Asian countries highlighted this observation during an in-depth panel session called “Energy Independence: Indigenous is Energy Security” during this year’s Powertrends at the SMX Convention Center in Pasay City.
The energy experts who participated in the panel discussion were Dr. Arthur Saldivar-Sali, author of “Black Gold: The Search for Oil to Power a Nation” and former PNOC chief geologist; Anton Safronov, chief commercial officer of Parami Energy (Myanmar); lawyer Kiril Caral, managing counsel of Shell Philippines B.V.; Ramon Clarete, project director of Gas Policy Development Project (GPDP); Jeoffrey Caranto, president of National Geothermal Association of the Philippines (NGAP); and Rob Fisher, development manager of Tamarind Resources (Malaysia).
The panelists gave useful insights on how the country can learn from its neighbors on the area of energy independence, as well as solutions on addressing the current energy situation and responding to future trends where energy demand is expected to grow.
“We cannot afford to not do anything. We don’t want to go back to the 90s where we were not ready to cope with the energy demands of the country,” Clarete said.
Natural gas for cheaper electricity
Natural gas is an energy source that is a viable but an underdeveloped alternative to oil, with the only major development in the Philippines being the Malampaya Deep Water Gas-to-Power Project, which was a result of the collaboration between the Philippine government, Chevron, and Shell Philippines Exploration BV (SPEX).
It has since then supplied power to 40 percent of Luzon or 30 percent of the whole Philippines.
However, Safronov, Myanmar-based Russian energy expert, has observed that high electricity rates remain in the country.
Recalling his time working for French petroleum firm Total, Safronov said this is the reason why the company chose to look into the Philippines to invest in.
He said what we are paying per kilowatt-hour is “almost the same amount of price that Singaporeans pay.”
Safronov believes that the Philippines’ long-time partnership with Shell is an opportunity to learn from one of the best technological leaders in natural gas.
He hoped that the country can take this further to contribute to its self-sustaining production, so the Filipinos will ultimately be able to pay a low price per kilowatt-hour of electricity.
Caral, meanwhile, said the success of natural gas exploration in the country has become the solution to the intermittent nature of renewable energy as natural gas is considered not only indigenous but also stable.
“The Malampaya project was a huge success. Malampaya’s help in meeting a substantial part of the country’s energy demands merits new explorations in this area,” he said.
Caral added that to elevate the Philippines’ energy independence, the Department of Energy should continue pushing for more onshore and offshore explorations in the Philippines.
“We need to have more Malampayas. We need to be able to replicate the success that Malampaya has achieved,” Caral said.
He said there is a need to remove legal uncertainties and provide physical stability for investors, which are critical in times of low oil prices.
“It is important for the government to strike the right balance between getting its rightful share but also making it attractive and competitive compared to other countries,” he said.
PH once a trailblazer in energy independence
Given the country’s present energy woes, it might be far-fetched to think that the country was once on track toward being self-sufficient regarding its energy needs, but Sali said it did happen during the Marcos era, when the government-owned Philippine National Oil Company (PNOC) was established.
Sali, who served as PNOC chief geologist, technical director of the Petroleum Board, and deputy director of the Bureau of Energy at the time, said the PNOC was “drilling 10 exploration wells a year and had one discovery every year from 1974 to 1986.”
Their initiatives also pushed the Philippines to rank second in geothermal power just after the United States.
For 12 years, the efforts of the Ministry of Energy and the PNOC reduced the dependence of the country to global imports.
At the time, the country’s energy supply went from zero percent indigenous to 50 percent indigenous. In other words, half of the Philippines energy requirements then were supplied by indigenous energy sources.
“We came from very active to almost none. And that is the major reason why we are at the bottom of the Southeast Asian energy picture,” he added.
“The abolition of the Ministry of Energy and the removal of PNOC’s status as a government-owned private corporation (GOCC) resulted in the stoppage of all energy projects in the ensuing post-Marcos years,” Sali said.
This drove many of Sali’s colleagues to leave the government and the Philippines and be hired to manage the energy arms of foreign governments and private firms in New Zealand, Australia, Japan, Indonesia, Singapore, and other countries.