DEVELOPMENTS IN THE PHILIPPINE ENERGY SECTOR · developments in the philippine energy sector ... kabugao, apayao 360 mw san roque hydro ... legend: s indicative committed

DEPARTMENT OF ENERGYDEPARTMENT OF ENERGY

DEVELOPMENTS IN THE PHILIPPINE ENERGY SECTOR

A Vision for the Future of Philippine Energy

SEC. VINCE S. PÉREZDepartment of Energy

22 August 2002


OVERVIEW OF THE PHILIPPINE ENERGY SECTOR


Local Oil2%

Imp. Coal 8%

Loc. Coal2%

Geo8% NRE

30%

Imp. Oil 45%

Hydro 5%

Total Energy: 243.4 MMBFOE Indigenous Energy Level: 45%Total Energy: 243.4 MMBFOE Indigenous Energy Level: 45%

Primary Energy Mix Y2000 Primary Energy Mix Y2002

INDUSTRY BACKGROUND

Overview of Philippine Energy Sector

Imp. Oil37%

NRE30%

Loc. Gas8%

Geo6%Local Oil

3%Hydro

4%

Local Coal2%

Imp. Coal10%

Total Energy: 266.9 MMBFOE Indigenous Energy Level: 52%Total Energy: 266.9 MMBFOE Indigenous Energy Level: 52%


PETROLEUM SECTOR


UPSTREAM DEVELOPMENTS

Vast Potential in Hydrocarbons

836Reserves 137

Potential

2,848Mapped

5,074

Unmapped

Total Resources (million bbl o.e.)

• Recent studies show hydrocarbon resource potentials larger than previously projected

• 16 sedimentary basins representing an area of over 700,000 sq.km.

Sedimentary Basins


UPSTREAM OIL & GAS SECTOR

n Total Service Contracts awarded, 7

n Geophysical Survey and Exploration Contracts (GSEC) – 9

n Farm-in of Shell into South China Resources, Inc. for an offshore oil exploration project in Northeast Palawancovered by GSEC-99

n Awarded GSEC 101 in June ‘02 to Sterling Energy Limited Partnershipu Covers 1,036,00 ha. near Reed Bank offshore

Philippinesu First foreign exploration in the last 4 years

n Recently awarded GSEC to Japan Petroleum Exploration Co., Ltd. (JAPEX)u Covers 328,000 ha. Offshore of Tañon Strait

Petroleum Contracts


UPSTREAM DEVELOPMENTS

Malampaya Developments• Malampaya Deep Water-Gas-to-

Power Project now operationalsupplying fuel to:

– Ilijan (1,200 MW)

– Sta. Rita (1,000 MW)

– San Lorenzo (500 MW to commence 1st Q2002)

• Malampaya Oil Rim Find

– Yield increased to 23,000 barrels/day

– Test results under study for EWT2


DOWNSTREAM OIL & GAS SECTOR

• Batangas-Manila (BatMan)

• Pipeline to connect Manila with the Malampaya Nat Gas Reserve

• Multiple parties interested

• Numerous feasibility studies conducted

• Consortium still being eyed

Proposed Natural Gas Pipeline

Malampaya

BatMan


DOWNSTREAM OIL & GAS SECTOR

• Bataan-Manila 2 (BatMan 2)

• To receive LNG importation and supply industrial ecozones in Subic & Clark

• Potentially to supply fuel in Central Luzon and petrochemical plants located in the area

• Proposed site for LNG Terminal

Proposed Natural Gas Pipeline

MalampayaBatMan 2 or Robin


DOWNSTREAM OIL INDUSTRY

Pandacan Oil Depotn MOU among the City

Government of Manila,Caltex, Petron, Shell and the DOE signed last 26 June 2002

n Big 3 agreed to scale down area of operation to widen buffer zone to the surrounding residential community

n Joint operation of integrated facilities

n Creation of a Green Buffer Zone


OTHER DEVELOPMENTS


n Potential development in ocean, solar and wind (OSW) energy

n Philippine wind energy potential could be as much as 70,000 MW

n Significant progress in wind farms:u 40MW wind farm project in Burgos,

Ilocos Norte by PNOC-EDC

u 25 MW wind farm project in Bangui Bay, Ilocos by Northwind Power funded by DANIDA

u Most popular OSW inquiries with DOE

RENEWABLE ENERGY

Wind Energy Potentials


RENEWABLE ENERGY

• Installed capacity of 1,931 MW

• 2nd largest user of geothermal energy resources for power generation

• Potential of 730 MW from 11 explored prospect areas

Geothermal Power

Malitbog Facility in Leyte:Largest Geothermal Power Plant in the World

Visayas

Luzon

Mak-Ban, Laguna425MW

Mindanao

Tiwi, Albay330MW

Sorsogon/Albay

150MW

Mt. Apo 100MW

Tongonan, Leyte 710MW

Palinpinon, So. Negros

198MW


n Development of additional 1,299 MW for the period 2002-2011

n Installed capacity anticipated to increase to 3,820 MW by 2011

RENEWABLE ENERGY

Hydropower Development

NALATANG HYDRO

BUGUIAS, BENGUET75 MW

AGBULU

KABUGAO, APAYAO 360 MW

SAN ROQUE HYDRO

SAN ROQUE, PANGASINAN345 MW

VILLA SIGA HYDRO

BUGASONG, ANTIQUE

32 MW

TAGOLOAN HYDROSUMILAO, BUKIDNON

68 MW

KALAYAAN 3 & 4 PSKALAYAAN, LAGUNA

350 MW

PACUAN HE

NEGROS ORIENTAL33 MW

PULANGI V HYDRO

ROXAS, NORTH COTABATO225 MW

BAKUN A/C HYDRO

LA UNION, ILOCOS SUR, BENGUET70 MW

CASECNAN HYDROPANTABANGAN, NE

140 MW

DIDUYON HYDROALICIA, QUIRINO

332 MW

KANAN HYDROINFANTA, QUEZON

113 MW

TIMBAHAN HYDROMADALAG, AKLAN

29 MW

LEGEND:

s INDICATIVE

COMMITTED

BINONGAN HYDROBANGUED, ABRA

175 MW

ABUAN HYDROILAGAN, ISABELA

60 MW

ILAGUEN HYDROSN. MARIANO, ISABELA

60 MW

ADDALAM HYDRO

CABARROGUIS, QUIRINO46 MW

AGUS III HYDROLANAO DEL NORTE & SUR

225 MW

BULANOG - BATANG HYDRO

TALAKAG, BUKIDNON132 MW

Projected Hydro Power Plants


n Priority dispatch of small renewable energy under WESM Rules

n Allocate a minimum amount of generation capacity from renewable energy

n Promotion of Green Renewable IPPs (GRIPPs)

n Introduce Green Pricing Program mechanism to promote consumer choice of power supply

RENEWABLE ENERGY

Upcoming Policies


Promotion of as alternative transport fuels :

n Compressed Natural Gas (CNG) in Luzon

n LPG in the Visayas

n Coco-diesel in Mindanao

ALTERNATIVE FUELS

Upcoming Policies


PHILIPPINE ENERGY PLAN


MACRO-ECONOMIC GOALS

• Economic Growth

• Poverty Alleviation

• Market-based Industry


POWER DEVELOPMENT PLAN


ELECTRICITY DEMAND AND SUPPLY PROFILEActual vs. Forecast Demand

-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Megawatt EO 215 implementedPower Reform Act of 2001

FPCA formula introduced

Power Crisis

Financial Crisis

Electric Power Crisis Act of 1993Creation of DOE

BOT Law

First IPP (Hopewell 210 MW)

New BOT Law

Only limited capacity was added during 1986-1991

Installed Cap.




-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011



Power Crisis

Financial Crisis


BOT Law


New BOT Law


Dependable Cap.

Installed Cap. 6,503




-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011



Power Crisis

Financial Crisis


BOT Law


New BOT Law


Dependable Cap.


PDP 1993




-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011



Power Crisis

Financial Crisis


BOT Law


New BOT Law


Dependable Cap.


PDP 1993

PDP 1996 (High)




-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011



Power Crisis

Financial Crisis


BOT Law


New BOT Law


Dependable Cap.


Actual Demand 3,228

PDP 1993

PDP 1996 (High)



Energy Demand-Supply OutlookMacro-Economic Parameters

GDP Growth 2000-2012

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

Year

LowHigh

‘00 ‘01 ‘02 ‘03 ‘04 ‘05 ‘06 ‘07 ‘08 ‘09 ‘10 ‘11 ‘12


SYSTEM PEAK DEMAND FORECAST

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

MindanaoVisayasLuzon

Low GDP Scenario

Annual Growth:7.6%

High GDP Scenario

Annual Growth: 8.2%

2002 2003 2007 2012 2002 2003 2007 2012


INSTALLED GENERATING CAPACITY

Fuel Type Luzon Visayas Mindanao TOTAL

Oil-Thermal 650 - 109 759

Diesel 911 492 438 1,840

Gas Turbine 930 - - 930

Coal 3,758 205 - 3,963

Hydro 1,510 12 997 2,518

Geothermal 907 919 104 1,931

Natural Gas 2,263 - - 2,263

TOTAL 10,929 1,604 1,647 14,204

In MW, as of June 2002


M I N D A N A O

N E G

R O

S

L U Z O N

P A N A Y

S A M A R

Region II

230 kV550 kV

69 kV

INTERCONNECTION PROJECTS

NEGROS-PANAY (1990)Capacity: 100 MWVoltage: 138 KV

LEYTE-LUZON (1998)Capacity: 440 MWVoltage: + 350 HVDC

LEYTE-CEBU (1997-2004)Capacity: 400 MWVoltage: 230 KV

LEYTE-BOHOL (2004)Capacity: 100 MWVoltage: 138 KV

NEGROS-CEBU (1993)Capacity: 100 MWVoltage: 138 KV


CAPACITY ADDITIONS

YEAR COMMITTEDINDICATIVE

BASELOAD INTERMEDIATE

2004 430 - -

2005 385 - 300

2006 200 - 502007 - 150 -

2008 - 250 -

2009 - 1,050 1002010 - 1,700 -

2011 - 1,450 -2012 - 800 -

TOTAL 1,015 5,400 450

In MW, TOTAL PHILIPPINES


INDIGENOUS RESOURCES FOR ADDITIONAL GENERATION CAPACITIES

PLANTS LUZON VISAYAS MINDANAO COUNTRY

Nat Gas - - - -

Geothermal 310 700 120 1,130

NRE 587 50 - 637

Coal 380 400 400 1,180

Hydro 1,611 94 806 2,511

TOTAL 2,888 1,244 1,326 5,458

In MW, 2003 – 2012


ENERGY SECTOR REFORM

• Creation of National Transmission Company (“TRANSCO”)

• Creation of Power Sector Asset and Liabilities Management Corporation (“PSALM”)

• Creation of new Energy Regulatory Commission (“ERC”)

• Creation of Wholesale Electricity Spot Market (“WESM”)

• Privatization of the National Power Corporation (“NPC”)

• Open Access subject to Pre-Conditions

R.A. 9136 provides for the:


ENERGY SECTOR REFORM– Promulgation of Distribution Code in Dec. 2001

– Promulgation of Grid Code in Dec. 2001

– Approval of the Implementing Rules and Regulations (“IRR”) on 27 February 2002

– Signing of EO 100 on Tax Equalization of Indigenous Source of Energy on 03 May 2002

– Unbundling of NPC Rates on 26 June 2002

– Promulgation of WESM Rules on 28 June 2002


ENERGY SECTOR REFORM– Promulgation of Interim Rules & Regulations for

downstream natural gas

– Department Circular on penalties for LPG violators

– Proposed Department Circular on penalties for delayed IPO by oil majors

– Proposed EO for loan condonation of Electric Cooperatives (ECs)

– Proposed Investment Management Contracts (IMC) for ECs


ENERGY SECTOR GOAL

• Stable & secure energy supply

• Wider access to energy supply

• Fair & reasonable energy prices

• Clean & efficient energy fuels & infrastructures

• Enhanced consumer welfare & protection

• Technology transfer & manpower development

• Job creation from energy activities


THANK YOU! THANK YOU!

www.doe.gov.ph

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DEVELOPMENTS IN THE PHILIPPINE ENERGY SECTOR · developments in the philippine energy sector ... kabugao, apayao 360 mw san roque hydro ... legend: s indicative committed