Demand for alternative energy sources on the rise – Shell

MANILA, Philippines - Rising global energy demand is pushing countries to look for alternative energy sources, according to Royal Dutch Shell, the global energy giant.

In a recent presentation titled Understanding the Gas Business to Philippine energy reporters, Duncan van Bergen, general manager for Shell’s Global Gas and LNG Market Development, Upstream International Integrated Gas, said that government support is needed to make LNG (liquified natural gas) a reality in the Philppines.

According to data presented by Shell, millions of people will rise out of energy poverty and with higher living standards, energy use will rise.

Thus, it said energy demand could double from its level in 2000 while carbon emissions must be cut in half to avoid serious climate change.

It said that energy demand could rise by more than 50 percent from 2010 to 2050, paving the way for more gas demand.

In the case of the Philippines, Bergen, citing data from the Department of Energy, said power capacity needs to grow urgently. He said there is an estimated 3.7 gigawatt shortfall by 2020 in the Luzon and the Visayas grids.

He said that LNG has the potential to provide the world’s additional energy requirements and can help lower CO2 intensity.

Gas plants emit around half the CO2 of coal and even up to 70 percent less of the CO2 emission in the case of an old coal plant.

Furthermore, gas fired power stations can be built and operated in a much shorter timeframe, which allows natural gas to be deployed quickly to meet any future supply gaps.

In the Philippines, he said LNG should play a key role in fueling the country’s growth.

LNG is natural gas that has been converted into liquid for ease of storage or transport.

Government he said must provide the following: A balanced energy mix policy, facilitate the development of LNG import infrastructure, must build gas pipelines to allow more customers to access natural gas and finally, the government must enforce air emission regulations to improve air quality.

Shell itself is planning to build a floating LNG regasification terminal beside its oil refinery in Batangas, with an estimated cost of $1 billion. The terminal would allow LNG – natural gas, which has been converted into liquid state – to be converted back into gas and be distributed as natural gas.

The Philippines, for its part, said investors can indeed put their money in the natural gas sector.

With several natural gas pipeline projects lined up by the government, private sector can participate in related industries, it said.

According to the Philippine Energy Plan (PEP), there are nine pipeline projects targeted to be put in place in Luzon from 2017 to 2022.

The proposed pipelines are deemed necessary for the development of the country’s natural gas industry.

These nine projects are the Batangas-Manila 1 (BatMan 1), BatMan 2, Bataan-Cavite (BatCave), Subic Pipeline, Clark Pipeline, Subic-Fort Bonifacio Pipeline, Sucat-Malaya, Sucat-Quirino lines and a city gas distribution network — the EDSA-Taft Gas Pipeline, according to the PEP.

The BatMan 1 project is considered the backbone infrastructure with an estimated distance of 105 kilometers and is a high-pressure gas transmission pipeline from Batangas to Sucat.

“It is expected to operate commercially by 2017. It will deliver the necessary gas requirements for the economic zones located along the route from Tabangao, Batangas to Sucat, Paranaque and the transport sector for the CNG-fuelled buses and taxis,” the PEP said.

The supply of natural gas for the BatMan 1 pipeline will come initially from the production of the Malampaya gas field and will be supplemented by LNG (liquefied natural gas) importation in 2020, the Department of Energy also said.

BatMan 2, on the other hand, is a 140 kilometer high pressure pipeline that will serve possible markets such as the Limay combined cycle power plant, which can be converted to natural gas-fired plant, and economic zones, notably Subic and Clark, including industries located along the route.

BatMan 2 is targeted to be in place by 2020.

BatMan 1 and BatMan 2 will be connected via another infrastructure project, which is the 40-kilometer undersea Bataan-Cavite and through the 35-kilometer Rosario, Cavite, Laguna (RoBin) line.

Four additional pipelines will be constructed, according to the PEP.

These are the 40-km Subic pipeline which will be linked with the proposed BatMan (2021); the 25-km Clark pipeline to start from BatMan 2 going to Clark (2022); the 35-km Sucat-Malaya pipeline (2017) which is an underwater high pressure gas transmission pipeline from Sucat, Paranaque to service the Malaya Plant in Rizal, which is proposed to be converted into a natural gas plant; and the 15-km Sucat-Fort Bonifacio pipeline that will service the requirement of commercial establishments inside the Fort Bonifacio Global City (2017).

The BatCave, on the other hand, is a 40-km undersea high pressure gas transmission pipeline, which is targeted to be in place by 2022.

This is designed to transmit gas from Bataan province via Cavite to Manila.

“Another pipeline project will also be available — the 40 km gas pipeline along EDSA-Taft Avenue or the ET Loop. It is expected to supply gas to large commercial establishments as well as for transport vehicles that ply around the Metro Manila area,” the PEP also said.

Indeed, the Philippine energy sector is in dire need of investments.  The private sector would not only find business opportunities here but have the chance to serve Filipino electricity consumers as well.