Shell may increase investments in the Philippines

The Philippines’ Finance Secretary, Cesar Purisima, announced that oil industry leader Pilipinas Shell Petroleum Corp. may increase its investments in the Philippines by as much as US$1 billion. Shell said it had signed an agreement with the Philippine government to jointly undertake a technical feasibility study of the company’s plan to set up a liquefied natural gas (LNG) terminal in the province of Batangas.
President Benigno Aquino III told reporters that Shell and Nestle have discussed their plans to expand their operations in the country. “If you remember, we went to Batangas a while back; they were talking about their expansion. They’ll be awarding the contract for the construction of the expansion for Malampaya by next month. It is projected to produce about 7,000 jobs,” the president said.
Simon Henry, chief financial officer of Royal Dutch Shell Plc, said, “This Memorandum of Understanding (MoU) is indicative of our support to the Philippine government’s aspiration to diversify its energy sources as embodied in its natural gas master plan.”
The proposed site for the LNG terminal is adjacent to Shell’s refinery in Tabangao, Batangas. The two parties have agreed to finish the feasibility study by 2012, and have set 2016 as the target date for a “first gas.”
Edgar Chua, Pilipinas Shell country chairman, explained that the study would determine the steps needed to upgrade the facility so that the company would be able to meet the new Philippine National Standards (PNS) for Euro IV-grade gasoline and diesel fuel, which is scheduled for implementation by 2016.
Through the Department of Energy (DOE), the Philippines is working on a natural gas master plan to diversify the country’s energy sources and address the country’s energy demand.
Shell presents plans for Malampaya
Around 40 to 50% of the fuel for the gas-fired plants located in Luzon, the country’s biggest island, is supplied by the Malampaya natural gas field in northern Palawan. Shell said that Phase 2 of the Malampaya project will require an additional US$1.04 billion, which will involve drilling of additional wells by 2014. Phase 3 will begin in 2015, with the installation of a new platform. (June 8, 2012)