The Philippines is an emerging economy and its economy has greatly shifted

from agriculture to industry. In terms of energy use, conventional fossil fuels (Oil and

gas) are the main source for its primary energy demands, however Philippine economy

greatly increases at an undeniably fast rate therefore affecting the demand for electricity

and its consumption. According to Manila Electric Company (Meralco), in terms of

customer count, Meralco saw a 4.5% increase or an addition of about 285,000

connections per year, if this continues, it will seriously cause power shortage that will

affect its customers. Therefore, it is necessarily need to add an additional energy

sources, but alternative energy sources cannot reach the necessary energy that is needed

to fulfill the energy consumption of the Philippines. As researches focused on finding

energy sources, Malampaya was developed and it signaled the birth of the natural gas

industry in the Philippines.

Malampaya Gas-to-Power Facility is one of the greatest industrial undertakings

in the history of the Philippines. Acknowledged as one of the best examples of a highly

successful public-private partnership, the project is headed by the Department of

Energy and developed and operated by Shell Philippines Exploration (SPEX), on behalf

of joint venture partners Chevron Malampaya LLC and the Philippine National Oil

Company-Exploration Corporation. Malampaya works by extracting natural gas from

below the seabed off the coast of Palawan Island and transports it more than 500

kilometers by undersea pipeline to a natural gas refinery plant in Batangas City in

Luzon Island (Figure 1).

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 Figure 1: Malampaya Facility

It began commercial operations last January 2002. The project is expected to

produce 400-450 million cubic feet of gas per day for over 20 years (Sohn, 2017). The

refined gas from the Malampaya project feeds a separate pipeline project that supplies

three gas turbine power plants in Batangas province. These plants are expected to

supply Luzon with a total of 3,200 megawatts of electricity, which is over 16 percent

of the Philippines’ total power demand.

Figure 2: Power Supply in the Philippines

According to Natural Gas Association, Of the three fossil fuels used for electric

power generation (coal, oil, natural gas), natural gas emits the least carbon dioxide per

unit of energy produced. It emits 30% less carbon dioxide than burning oil and 45%

less carbon dioxide than burning coal.

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 Figure 3: Natural Gas Composition

Burning natural gas also releases lower amounts of nitrogen oxides, sulfur

dioxide, particulates and mercury when compared to coal and oil therefore Natural gas

can be very efficient in reducing the greenhouse gas effect in the world.

Malampaya field contains recoverable natural gas reserves of some 2.7 trillion

cubic feet and 85 million barrels of condensate. The gas is extracted from 2,200 meters

below the seabed, which is at a water depth of 830 meters (Shell, 2001). This project to

extract natural gas deposits from over 3,000 meters below sea level and transport this

to a market over 500 kilometers away posed one of the greatest deep-water challenges

in the world and required the use of the latest in gas technology and skills.

The Malampaya franchise is set to expire in 2024. The natural gas it has

produced has provided a significant share in our electricity production mix. Malampaya

has given us a fuel option that is cleaner than coal, the predominant fuel source today.

However according to SPEX, it is foreseen that the Malampaya site will run out

of Natural gas by 2022, earlier than the contract expiry therefore Shell explore much

more natural gas extraction sites in the Philippines.

Natural gas is an efficient source of energy but it is a non-renewable source,

therefore it can be depleted at some point. It is the crisis that Malampaya and the

Philippines faces, a declining supply of natural gas in the extraction site at Palawan.

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 Because China continues to claim Recto Bank (Figure 4), a partial part of the

West Philippine sea, according to the data from the United States Geological Survey

said that Recto bank and other portions of West Philippine Sea contains more than 11

billion barrels of oil and 190 trillion cubic feet of natural gas in proved and probable

sources.

Figure 4: Recto Bank in West Philippine Sea

It will be very hard for the government to discover a spot that a natural gas can

be extracted. According to Department of Energy, Failure to assure natural gas with a

capacity to supply a minimum five million tons of natural gas equivalent to 5,000 MW,

will idle the power plants. With the country’s economy dependent on the constant

supply of reasonably priced electricity, failure is not an option. Therefore, before the

Malampaya loses it supply that can be estimated at the year 2022, government invests

at LNG (Liquified Natural Gas) terminals and import Natural gas.

Natural Gas can be transported in two ways, one in the form of pipelines that

Malampaya has used and another is transportation as a liquified natural gas via special

LNG tankers.

Figure 5: LNG Tankers

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 This is the only reason for liquefying the natural gas, after transportation, LNG

is commonly vaporized again so as to acquire energy from it. So far, the direct usage

of LNG as fuel remains uncommon. LNG tankers are usually identifiable from their

spherical liquid gas tanks, the top half of which is above the deck (Figure 5). The

spherical shape is perfect for both the pressure resistance and heat insulation of the

tanks. As vaporization cannot be completely prevented even with good insulation,

several mechanisms are in place to guarantee that the pressure in the tanks does not

surpass the permitted maximum. For instance, the vaporized natural gas can be used for

ship propulsion.

The major difficulty in the use of natural gas is transportation and storage

because of its low density. Natural gas pipelines are economical, but are impractical

across oceans. Many existing pipelines in North America are close to reaching their

capacity, prompting some politicians representing colder areas to speak publicly of

potential shortages. In Europe, the gas pipeline network is already dense in the West.

New pipelines are planned or under construction in Eastern Europe and between gas

fields in Russia, Near East and Northern Africa and Western Europe.

LNG carriers can be used to transport liquefied natural gas (LNG) across

oceans, while tank trucks can carry liquefied or compressed natural gas (CNG) over

shorter distances. Sea transport using CNG carrier ships that are now under

development may be competitive with LNG transport in specific conditions.

For LNG transport a liquefaction plant is needed at the exporting end and

regasification equipment at the receiving terminal. Shipborne regasification equipment

is also practicable. LNG transportation is established as the preferred technology for

long distance, high volume transportation of natural gas, whereas pipeline transport is

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preferred for transport for distances up to typically 4.000 km overland and

approximately half that distance overseas.

For CNG transport high pressure, typically above 200 bars, is used.

Compressors and decompression equipment are less capital intensive and may be

economical in smaller unit sizes than liquefaction/regasification plants. For CNG mode

the crucial problem is the investment and operating cost of carriers. Natural gas trucks

and carriers may transport natural gas directly to end-users, or to distribution points

such as pipelines for further transport.

The main alternatives to natural gas include nuclear power, solar power,

ethanol, and wind power. Fossil fuels still dwarf these alternatives in global and

domestic energy markets, but there is considerable public momentum to increase their

utilization. The government was not utilizing the Bataan nuclear power plant because

it can cause hazards to areas and the people living nearby, also it was not fueled because

of the issue of 1986 Chernobyl Nuclear Power Plant disaster in Ukraine wherein almost

100 thousand people were affected due to radiation poisoning. Solar and Wind power

are a better alternative and cleaner than natural gas, but it doesn’t produce enough

energy to produce energy to powerup a large percentage of the Philippines.

To address these challenges, the Philippine Petroleum Association of the

Upstream (Oil and Gas) Industry (PAP) is working closely with the government

agencies to revitalize oil and gas exploration.

As pointed out by the Department of Energy, the Philippines is still very much

underexplored. Even in offshore northwest Palawan, where Malampaya and other oil

and gas fields are located, new leads and prospects have been delineated that need

follow up exploration and drilling. In addition, extensive 2D and 3D seismic surveys

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conducted in offshore southwest Palawan had delineated several large oil and gas

prospects, which together could be multiples of Malampaya.

In a sense, the reality of Malampaya’s full exploitation makes other potential

deposits in contested waters in the West Philippine Sea that more important. The

Duterte administration is trying to develop political options that will make the

development of potential natural gas deposits in Recto Bank possible. Experts say there

are technical solutions to exploit the new fields and tie-back to Malampaya to make use

of its facilities including the pipeline to Batangas. But the political problem with China

is a tough nut to crack.

The government do not have all the time in the world to wait for China and the

Philippines to have an agreement on Recto Bank. Even if the government manage to

agree on something, the development of a new gas field can take a decade. That starts

with exploration activities which cannot take place until a geo-political agreement is

reached.

This is why setting up an LNG import facility tied into the existing gas-fired

power plants is an urgent need. Though government can use alternative liquid fuel, the

overall economics would be expensive for the consumer. We must realize that the

offshore platform can support gas exploration in adjacent fields. The problem is that

the LNG terminal as the only proposed solution forces the country to import even if

there may still be available indigenous sources, and this will bite us back in the end.

And there are many negative side effects if we force importation rather than exploration

of our own resources. if our government decides to focus primarily on importation, it

discourages exploration, further exposing the country to higher prices like exchange

rate risks, volatility of fuel prices in the world market and it can lead to possible supply

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hostage, which is a scary situation for our economy if the government consider the

possible geopolitical risks not only with fuel source but also in shipping.

As the Philippine Nuclear and Oil Corporation (PNOC) position paper puts it:

“It is a complex political, technical, and commercial issue. Our power demand

characteristic requires a fuel which can give the needed mid merit and peaking

capability.”

It is of utmost importance that the necessary government decision is made

quickly to give industry time to provide the best service and cost to consumer, while

allowing the future generations to live in a less polluted world.

For the First Gen Power group that owns the power plants using Malampaya

gas, First Gen has been planning what to do after 2024 and are ready to work with

government on post Malampaya plans.

First Gen has, in fact, already spent millions of dollars on studies to put up in

the next five years a liquefied natural gas (LNG) terminal in their Batangas site to

support their gas fired power plants post Malampaya. First Gen plan is to start

developing this $1 billion (LNG) terminal next year and are also expecting to close

partnerships and engineering, procurement, and construction (EPC) contracts within

this year.

It is just as well that the private sector is moving because the Luzon power grid

is depending on those power plants to keep on working beyond Malampaya. PNOC has

come up with plans, but there is little movement on the ground that amounts to anything.

First Gen has expressed a willingness to work with PNOC, but is taking no chances on

any interruption of the LNG supply they need.

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 The demand for LNG has increased significantly over the past years as China is

replacing their polluting coal-fired power plants with power plants using LNG (Figure

6). The first order of business is to make sure we have this LNG terminal which takes

many years to build.

Figure 6: Global LNG Demand

The government was trying to build an alternative option for the declining

supply of Malampaya but to think that government just sorted out to importation of

natural gas, It is a bit odd, the government should use all the resources in the

Philippines, Using LNG terminals should be just a temporary solution because the price

of natural gas in the foreign countries is not steady it can go high, and the price will go

down to the consumers thus, the government should focus on two things, claiming the

recto bank that china claims and building temporary LNG terminals for the declining

supply. The resources of the Philippines should be ours to claim and not to be benefitted

by others.

Hydrogen was discovered by H. Cavendish in 1766; he concluded that water

was not an element but was formed by hydrogen and oxygen. The name “hydrogen”,

which means “water former” in Greek, was proposed by A.L. Lavoisier in 1783. This

highly reactive element, the first one in the periodic table, has two isotopes, deuterium

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and tritium. Hydrogen is the most abundant element in the universe and the third one

in the earth’s surface where it occurs as a diatomic molecule or combined with other

elements; 70% of the existent hydrogen is found in water and in organic matter. Since

the beginning of the 19th century, scientists have recognized hydrogen as a potential

source of energy; it is known that hydrogen could be used as a primary energy source

if the nuclear star reactions of hydrogen isotopes could be reproduced in magnetic

containers.

Hydrogen has the advantage to generate electricity when combined with oxygen

to produce water. Figure 7 shows the cycle for hydrogen energy.

Figure 7: Hydrogen Energy Cycle

A fuel cell is an electrochemical device, where hydrogen or other fuels can be

converted to electricity using an electrocatalyst; since this conversion is not limited by

the Carnot cycle, the efficiency in the generation of electricity is higher than in

conventional engines. Fuel cells operate at different working temperatures and could,

therefore, be used in different applications at sites where stable and continuous

electrical current is needed. Such is the case of hospitals, shopping malls, dwellings or

transportation. Figure 8 presents the main types of Fuel Cells together with the working

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temperature and their kind of fuel. If hydrocarbons instead of hydrogen are used as fuel,

a small amount of CO2 is formed.

Figure 8: Main Types of Fuel cells

In the past years several companies have been created to do research and

development on fuel cell energy: Tokyo Electric Utility, Kansai Electric Power

International Fuel Cells, Toshiba, Siemens/Westinghouse, Plug Power/GE, Fuel cell

Energy Corp, EPRI, Ballard Power Systems and others. Furthermore, Westinghouse

Company has announced the marketing of a 1 MW solid oxide fuel cell power plant

70% efficient, which started to operate in 2001. A new member of the fuel cell family

is the regenerative fuel cell, in which water is separated into hydrogen and oxygen by

a solar-powered electrolyzer. The hydrogen and oxygen are fed into the fuel cell, which

in turn produces electricity and water. The water is then recirculated back to the solar-

powered electrolyzer where the process is repeated. The choice of an adequate fuel cell

depends on its use. Hydrogen can also be extracted from oil, gasoline

and methanol through reforming, but in these cases carbon sequestration technologies

are required. Besides, hydrogen can be produced directly with sunlight and water by

biological organisms (Das, 1998) or by using semiconductors-based systems. The use

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of non-CO2 hydrogen producing technologies such as wind, solar or nuclear can help

to avoid global warming and environmental pollution.

Hydrogen can be stored as compressed gas, as liquid hydrogen and as metal

hydrides (Hanneken, 1999). Although some hydrides are commercial, studies on new

alloys with better conditions of temperature and pressure storage are still needed.

Research for hydrogen storage in carbon structures is currently under way worldwide.

In Kiev, Germany, the town gas which is composed of 60% hydrogen has been stored

in a gas cavern since 1971. Gas de France has stored hydrogen-rich refinery products

in an aquifer structure, and The Imperial Chemical Industries had stored hydrogen in

salt mines caverns. Hydrogen transportation depends on the needs. At present about 5%

of the hydrogen produced is delivered as liquid or gas by truck or pipelines. In Figure

9, the different methods of hydrogen transportation with their general use are shown

Figure 9 Methods of Hydrogen Transportation

Fuel cells are a promising technology for use as a source of heat and electricity

for buildings, and as an electrical power source for electric motors propelling vehicles.

Fuel cells operate best on pure hydrogen. But fuels like natural gas, methanol, or even

gasoline can be reformed to produce the hydrogen required for fuel cells. Some fuel

cells even can be fueled directly with methanol, without using a reformer.

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 In the future, hydrogen could also join electricity as an important energy carrier.

An energy carrier moves and delivers energy in a usable form to consumers. Renewable

energy sources, like the sun and wind, can't produce energy all the time. But they could,

for example, produce electric energy and hydrogen, which can be stored until it's

needed. Hydrogen can also be transported (like electricity) to locations where it is

needed.

Having Hydrogen as an energy source would definitely go up the electricity

supply of our country thus solving the declining supply of natural gas in the Malampaya

facility. But having many energy sources is more preferred for us to be more power

shortage proof. Natural gas and other fossil fuel help the Philippines to maintain power,

in addition of other renewable sources, and lastly the Hydrogen and Fuel Cell

Technology will help the Philippines to maintain the good energy supply for up to many

years.

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References:

ASTANOVSKY, D. L., L. Z. ASTANOVSKY, B. S.

RAIKOV and N. I. KORCHKAVA, 1994.

Reactor for steam catalytic hydrocarbon conversion and CO conversion in hydrogen

production. Int. J. of Hydrogen Energy. 19, 677-681.

AYMAR, R., 2001. Overview of ITER-FEAT - The future international burning

plasma experiment. Nuclear Fusion. 41, 301-310.

BAIN, A. and W. D. VAN VORST, 1999. The Hindenburg tragedy revisited: the fatal

flaw found. Int. J. of Hydrogen Energy. 24, 399-403.

DAS, D. and T. N. VEZIROGLU, 2001. Hydrogen Production by Biological Process:

a Survey of Literature. Int. J. of Hydrogen Energy. 26, 13-28.

DUNN, S., 2001. Hydrogen Futures: Toward a Sustainable Energy System.

“WorldWatch Paper 157. Peterson J. A. Ed. Washington D.C.

DURÓN, S., R. RIVERA-NORIEGA, M. A. LEYVA, P.

NKENG, G. POILLERAT and O. SOLORZA-FERIA,

2000. Oxygen reduction on a RuxSy(CO)n cluster electrocatalyst in 0.5 M H2SO4. J.

Solid State Electrochemistry, 4, 70-74.

FUNK, J. E., 2001. Thermochemical Hydrogen Production: past and present. Int. J. of

Hydrogen Energy. 26, 185-190.

HANNEKEN, J. W., 1999. Hydrogen in metals and other materials: a comprehensive

reference to books, bibliographies, workshops and conferences. Int. J. of Hydrogen

Energy 24, 1005-1026.

KREUTER, W. and H. HOFFMAN, 1998. Electrolysis: the important energy

transformer in a world of sustainable energy. Int. J. of Hydrogen Energy. 23, 661-666.

OGDEN, J. M., 1999. Prospects for building a hydrogen energy infrastructure. Annual

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Review of Energy and Environment. 24, 227-279

LÓPEZ-ALANIS, J. R. VARGAS GARCÍA, R. RIVERA

and S. M. FERNÁNDEZ VALVERDE, 2002. Protective ruthenium thin films on

CuInSe2for hydrogen evolution in acidic media. Int. J. of Hydrogen Energy. 27, 143-

147.

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