What’s happening with Malampaya?
September 16, 2021On September 11, natural gas supply from the Malampaya gas field came to an abrupt stop. The shutdown occurred weeks before the gas field’s scheduled maintenance shutdown in October.
As a result, two gas-fired power plants of First Gen Corporation, Sta. Rita (1,000 MW) and San Lorenzo (500 MW), shifted to high-cost liquid fuel as an alternative. The company’s San Gabriel plant (414 MW) was temporarily shut down.
While the restriction was lifted on September 14 – after three full days – around 1,900 megawatts of gas-fueled capacity were compromised by the recent Malampaya gas supply restriction Then again, prior to the untimely shutdown, energy output from gas-fired power plants were already being adversely affected by Malampaya’s depleting gas reserves.
CitizenWatch Philippines is deeply concerned about the negative consequences of this sudden shutdown and of the state of Malampaya Gas Field on ordinary Filipino consumers.
The sudden shift of gas plants to imported liquid fuels is bound to result in higher generation charges in the next billing period. Liquid fuel, is more expensive than the natural gas sourced from Malampaya. Moreover, the shortage of natural gas in Malampaya results in a constant increase in electricity prices sourced by power distributors and electric cooperatives from the Wholesale Electricity Spot Market (WESM).
If the response to these challenges had been planned and prepared for ahead of time, these issues would not have the dire implications that they currently have on the power and energy sectors.
There should be an investigation on Malampaya’s early shutdown. What is the real situation? Is the remaining natural gas reserve about to run out? When will Malampaya’s natural gas run out and what is the alternative?
In this protracted crisis the interest of the consumers must come first. Power disruptions always result in heavier burden to the people and the already depressed economy.
Atty. Tim Abejo
Co-Convenor for Power and Energy