Gas

Oil prices spiked again today. It is the third week in a row that substantial increases in oil happened and there is no clear indication the spiral is about to end.

- ALEX MAGNO

This event underscores the necessity to rapidly develop our natural gas resources, too long the subject of unforgivable policy neglect. We could be sitting on large deposits of natural gas, especially in the Benham Rise.

But we do not really know. We have stopped exploring long ago. Exploration involves huge capital outlays. We did not have the policy framework to encourage investments in natural gas exploration.

In the 90s, we had about 100 exploration projects in progress. Today, that number fell to nearly nil.

Meanwhile, our neighbors Indonesia and Malaysia benefit from well-developed indigenous gas industries. They are now considered many years ahead of the Philippines in their production of natural gas.

Natural gas, which produces lower carbon emissions, is considered a “transition” fuel from petroleum to fully renewable energy sources. Renewable energy requires more technological development to bring down costs and improve reliability before we could fully move away from fossil fuels.

What caused us to neglect development of more natural gas sources?

After we pumped gas from the Malampaya field, we fell into complacency. We did not renovate our energy policies quickly enough to encourage sustained exploration and development of this energy source. Meanwhile, cheaper natural gas imports dissuaded domestic investments in the industry.