Malampaya gas deliveries hit highest mark in 5 years

BATANGAS, CITY,Philippines — Indigenous natural gas deliveries from the Malampaya field offshore Palawan have climbed to a five-year high following the start of production from newly developed wells.

Prime Energy Resources Development B.V., the operator of the country’s only indigenous gas field, said Malampaya delivered 400 million standard cubic feet of natural gas per day, helping meet sustained electricity demand across the Luzon grid.

Prime Energy president and CEO Donnabel Kuizon Cruz said the increase in domestic gas supply could translate into lower electricity costs for consumers.

“When we started sharing the gas, our utilization of Malampaya also increased by 17 percent. When that happened, we noticed the price of the generation cost for gas-fired power plants had decreased,” Cruz said in an interview here yesterday.

The increase in gas deliveries follows the start of supply from the Malampaya East-1 and Camago-3 wells, developed under the $893-million Malampaya Phase 4 (MP4) project.

The two wells added 222 billion cubic feet of recoverable natural gas reserves, enough to generate an estimated 31.46 billion kilowatt-hours of electricity. This could supply around 13.11 million Filipino households for a year.

The additional gas is expected to strengthen Malampaya’s role in supporting Luzon, where the gas field accounts for about 13 percent of electricity requirements.

Malampaya supplies natural gas to Prime CoreGen’s portfolio of gas-fired power plants totaling two gigawatts, as well as the 1,200-megawatt Ilijan power plant owned by LNGPH, the multibillion-dollar gas venture of tycoons Manuel V. Pangilinan, Ramon Ang and Sabin Aboitiz.

“This whole integrated system is the beauty of what we do. Prime Infra invested in this whole gas-to-power infrastructure precisely to create this kind of optimization so that we can really ensure that we maximize the supply of gas to customers when it’s needed the most,” Cruz said.

MP4 involved drilling two deepwater wells and installing subsea infrastructure to connect them to the existing Malampaya production platform.

Completed in just 27 months from the final investment decision, the project finished five months ahead of its original schedule and the industry benchmark. It also marked the Philippines’ first offshore drilling campaign in more than a decade.

Prime Energy and its partners, Prime Oil and Gas Inc., UC38 LLC and PNOC Exploration Corp., operate the Malampaya field under Service Contract 38 with the government.

Prime Energy is the upstream natural gas exploration and development arm of tycoon Enrique Razon Jr.’s Prime Infrastructure Capital Inc.