A Narrative of the
Industry of the Philippines.

“Looming energy crisis foreseen as Philippines may lose 3,200 MW from existing gas plants, which generate about one-third of Luzon’s power”.

– ADB (2018)

In the pursuit of a sustainable energy future, the world is at a critical crossroads. Net-zero goals to combat climate change demand a pragmatic approach, acknowledging the limitations of renewable energy in meeting the escalating global demand. As the global community endeavors to transition to a net-zero future, ensuring energy security becomes imperative. The intermittent nature of renewable sources introduces volatility into the energy supply chain. New oil and gas explorations offer a stable and secure source of energy during this transitional period, mitigating the risks associated with the intermittency of renewable sources.

Understanding Energy Dynamics: Baseload and Peak Load

In the realm of energy, the terms “baseload” and “peak load” are paramount. Baseload represents the minimum constant power required to meet essential energy needs, while peak load refers to the maximum demand during specific periods. Fossil fuels, including oil and gas, currently serve as the primary source for baseload power due to their reliability and consistent supply. Unlike renewable sources, fossil fuels can provide a steady flow of energy, making them essential for maintaining a stable energy infrastructure.

Global Energy Dynamics and the Role of Oil & Gas

The geopolitical landscape and vulnerabilities in the global supply chain underscore the strategic importance of maintaining a diversified energy portfolio. Relying exclusively on renewable sources exposes nations to potential disruptions, compromising economic stability and national security. According to the International Energy Agency, oil and gas are projected to play a critical role in the energy mix, contributing over 50% of the world’s energy needs even in scenarios with aggressive decarbonization efforts, particularly between 2023 and 2050.

Empowering Philippine Energy Independence

The Philippine government recognizes the need for energy independence, a crucial component of its 2040 Energy Sufficiency Roadmap. The Department of Energy (DOE) is committed to intensifying the exploration and development of fossil fuels, not only to meet current energy demand but also to ensure a stable supply for the Filipino people. This strategic approach aligns with the DOE’s efforts to create a healthy energy mix by promoting both the renewable energy sector and new oil and gas exploration activities. The goal is to reduce reliance on imports and build a resilient energy infrastructure that can withstand the challenges of a rapidly changing global energy landscape.

 

In essence, the Philippines is actively steering its energy future towards a harmonious blend of sustainability, security, and self-sufficiency, aligning with global efforts to navigate the complex journey toward a net-zero world.

Indigenous Petroleum Reserves

Aligned with the DOE’s 2040 Energy Roadmap, the overall objective is to enhance indigenous petroleum reserves to reach 57.12 million barrels of oil (MMB oil) and 5.87 trillion cubic feet (TCF) of gas, while achieving production of 114.44 MMB oil and 4.04 TCF gas.

LNG Demand

By 2040, it is estimated that the country’s natural gas demand for power generation will reach a minimum of 16.8 MTOE, while non-power applications are expected to reach 0.05 MTOE.

Short-term Solution

The Philippines will need to source gas through international LNG trade, as the indigenous supply may not be sufficient to keep up with consumption.

The Untapped Potential of Indigenous Reserves

Recognizing the impending depletion of the Malampaya gas field by 2027, the Department of Energy is actively promoting investment opportunities in the upstream oil and gas sector. The Philippines boasts extensive resource potential, hosting 16 sedimentary basins that cover an expansive area of over 700,000 square kilometers. To date, the country has only had 10% of its hydrocarbon deposits explored.