PH-China modus vivendi needed to develop Sampaguita gas field – Atienza

House Senior Deputy Minority Leader Lito Atienza

A modus vivendi with China is needed to pave the way for the development of the Sampaguita gas field off West Palawan, House Senior Deputy Minority Leader Lito Atienza said on Sunday.

“The Sampaguita gas discovery is vital to our future energy security,” Atienza, who was once chief of the Department of Environment and Natural Resources, said in a statement. “It has become absolutely imperative for us to quickly develop Sampaguita, before Malampaya’s gas production starts to fall off in 2024.”

“We really wish that the Philippines and China, through effective diplomacy, can arrive at a mutually acceptable arrangement that would expedite the resumption of all work around Sampaguita,” he added.

He said that, if Manila and Beijing could somehow reach a modus vivendi, it would pave the way for the development of the Sampaguita natural gas discovery in offshore West Palawan.

The now 16-year-old Malampaya deepwater gas-to-power project still generates up to 3,400 megawatts (MW) of electricity for the Luzon grid, he noted.

According to Atienza, however, officials of the Department of Energy (DOE) told a recent Senate hearing that by 2024 Malampaya’s gas output would fall to just one-third of current capacity.

This implies that six years from now, Malampaya’s diminishing gas reserves would be able to produce just 1,100 MW of electricity for Luzon, Atienza said.

“Clearly, if we are unable to harness the gas from Sampaguita in time, Metro Manila and its surrounding provinces might reel from considerably higher electricity rates,” he said. “Power plants now running on cheap gas may be forced to use costlier not to mention dirtier imported fuel.”

Meanwhile, he cited an independent assessment by Weatherford Petroleum Consultants, which said that the Sampaguita gas field “is estimated to contain 2.6 trillion cubic feet of in-place contingent resources and 5.5 trillion cubic feet of in-place prospective resources.”

It forms part of Service Contract (SC) 72 Recto Bank in offshore West Palawan — in territorial waters challenged by China.

Atienza said that the Aquino administration ordered on Dec. 15, 2014 the private consortium operating SC 72 to suspend all work in deference to the maritime case that the Philippines filed against China before Hague-based Permanent Court of Arbitration (PCA).

The PCA eventually ruled on July 12, 2016 that Recto Bank, where SC 72 lies, is within the Philippines’ Exclusive Economic Zone, as defined under the United Nations Convention on the Law of the Sea, he said.

However, Atienza said that even with the favorable PCA ruling, the DOE up to now has not lifted the suspension of all work on SC 72.

Meanwhile, Manila and Beijing are still trying to figure out a framework on possible joint exploration for oil and gas in disputed waters, he added. /atm