Natural Gas and Oil in the Philippines

Natural Gas

Asia is home to some of the biggest natural gas resources in the region. Natural gas, considered as one of the cleanest and safest source of energy from fossil fuels, is composed mostly of methane. It is one of the most abundant hydrocarbons in the South China Sea. In fact, many other countries in Southeast Asia like Malaysia and Thailand contain similar natural gas deposits. Similarly, the Philippines is deemed to contain deposits of natural gas although large-scale commercial production is yet to be realized. The current production of natural gas in the country is not enough to sufficiently meet the local demand.

Natural Gas Reserves

According to the Oil and Gas Journal report, the Philippines holds an estimated 3.48 trillion cubic feet (Cbf) of national gas reserve as of 2008, majority of which is concentrated in the Malampaya offshore field. On one hand, the CIA World Fact Book (2009) estimates it at 98.54 billion cubic m while gas consumption was at 2.94 billion cubic m by 2008 estimates.

All photo credits to Jurvetson (Flickr Creative Commons image-Attribution License)
All photo credits to Jurvetson (Flickr Creative Commons image-Attribution License) | Source

Sampaguita Gas Field

With estimated 3.5 to 5 Tcf of natural gas, the Sampaguita field is being considered as another possible source of natural gas in the country. Forum Energy plans to conduct test drills in the area to confirm the natural gas reserves and the viability of a liquefied natural gas project (LNG) in the future.

Oil Reserves

A Department of Energy (DOE Philippines) data indicates that at the end of 2005, the country has total petroleum reserves of 456 million barrels of Fuel Equivalent (BFOE). This figure is composed of 25 million barrels of oil, 2,136 Bcf of natural gas and 54 million barrels of condensate. The country consumed 299 thousand barrels of oil a day in 2007 while oil production for the same year is at 336 thousand barrels which means that the country's production is just barely for local demand.

Malampaya Offshore Oil Field

The Philippines does not have a significant oil production history but this landscape has changed with the discovery of new offshore and deep sea oil deposits in the Malapaya field in 1990 by Shell Philippines. The Malampaya Oil rim is deemed to hold the country’s largest oil reserve.

This oil-rich deposit lies under the field’s natural gas deposits. Shell Philippines obtained full ownership of Service Contract 38 (SC38) and made one of the largest investments in the country’s gas industry by laying a 504-kilometer pipeline and establishing a gas facility in Batangas province. The Malampaya field has supplied clean fuel to the Luzon grid since 2002 by virtue of the government-initiated Malampaya Gas-to-Power project supplying three combine cycle gas turbines. The Malampaya field has over 28 service contracts as of 2007. Its discovery paved the way for the government’s Natural Vehicle Program for Public Transport (NGVPPT).

Galoc Oil

All photo credits to Galoc Production Company (GPC Copyrights)
All photo credits to Galoc Production Company (GPC Copyrights)

Galoc Oil Fields, Palawan, Philippines

The field located at 60 km northwest of Palawan has an estimated oil reserve of 10 million barrels and has produced over 5.4 million barrels or half of its reserves by June of 2010. Australian firm Otto Energy Ltd. I is part of the joint venture operating the Galoc Oil fields and holds a 31.38% stake in Galoc Production Co. (GPC). GPC operates the oil field under SC14-C. The daily production rate of the oil field has declined from 11,000 barrels per day (bpd) to 8.750 bpd. The Galoc Oil field went onstream in 2008.

The Philippines offers several incentives to petroleum service contractors under the Oil and Development Act of 1972 or Presidential Decree 87. The Business Monitor International’s (BMI) Philippine Oil and Gas report's latest forecast poised the Philippines as petroleum supplier of 0.76% while accounting for 1.11% of Asia Pacific’s regional oil demand by the year 2014. Though the Philippines is predicted to suffer a slight decline in oil production in the years ahead, positive growth is expected in the natural gas industry owing to the concrete efforts of the Philippine government in collaboration with noted international players. With the Philippines currently ranked as the 7th in the Downstream Business Environment ratings, the future indeed looks bright for the Philippine oil and natural gas sector.

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Comments 4 comments

mr. rigger 4 years ago

countries all over the world are getting from the OPEC and philippines is not a member, and United states has enough production and highly equip for producing energy and phi. is non independent in the investor for rig up the production.


gmmurgirl profile image

gmmurgirl 4 years ago from Pilipinas Author

Yes Mr. Rigger, you are right. Most of the resources are not yet developed this is why production in the country is not even enough for its own energy needs.


Mr rigger 4 years ago

not enough production and rigger. coz its new discover


Mr. Operator 4 years ago

why the Philippines need to import oil from the Middle east, and suffer on the highly expensive price of gasoline?

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