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Philippines says Shell-operated Malampaya resumes gas deliveries

Wed, 15th Apr 2015 06:47

MANILA, April 15 (Reuters) - The Philippines said that alocal unit of Shell had resumed natural gas deliveriesfrom the country's Malampaya field to three major power plantsafter a month-long shutdown, but energy supply on the mainisland of Luzon remains tight.

The Department of Energy (DOE) on Wednesday urgedelectricity users to conserve energy supplies after the Luzongrid recorded its highest daily demand so far this year at 8,271megawatts (MW), with appetite likely to rise further next month.

Southeast Asia fastest-growing economy faces an electricityshortfall in Luzon because of delayed power projects, which mayhurt a revitalised manufacturing sector and booming call centreindustries.

Some 16,400 MW of new supply is planned in the country overthe next five years, but some projects have been held up byenvironmental opposition to coal-fired stations, while othersare waiting for customers to commit to long-term supply deals.

Malampaya's maintenance shutdown, which started on March 15,had added to fears over interruptions to electricity supply,prompting President Benigno Aquino to seek special powers fromCongress as early as September last year to avert brownouts.Lawmakers have yet to grant his request.

Shell Philippines Exploration BV, operator of Malampaya, hasa 45-percent stake in the gas-to-power project that fuels FirstGen Corp's 1,500 MW San Lorenzo and Santa Rita powerplants, and the 1,200 MW Ilijan plant operated by San MiguelCorp's unit, SMC Global Power Holdings Corp.

Chevron holds 45 percent of the project, while state-ownedPhilippine National Oil Co has 10 percent.

The country's power demand usually starts to rise as theweather warms in March, and then peaks in May, the DOE said in astatement. Air conditioners are typically cranked up in thesummer.

The government has called on companies with standbydiesel-fuelled power generators to help avert brownouts, askingthem to participate in the so-called Interruptible LoadProgramme (ILP).

Under the ILP, participants with loads of at least 1 MW willrun their generator sets, if needed, instead of drawing powerfrom the grid.

As of April 10, 242 companies with a combined load of 910.1MW had signed up, the DOE said, including big power users likeSM Prime Holdings Corp and Ayala Land Inc,the country's biggest mall operator and condominium builderrespectively. (Reporting by Erik dela Cruz; Editing by Joseph Radford)

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