The depleting Malampaya field has stopped supplying gas to the three gas-fired power plants of First Gen Corporation starting Saturday, September 11, compelling the shift of the electric power generating facilities to more expensive liquid fuels.
Sources from First Gen confirmed that the 1,000-megawatt Santa Rita gas plant already ceased receiving gas supply from the Malampaya field on September 11 (Saturday) while its San Lorenzo plant was no longer supplied with gas since September 12 (Sunday).
The other gas-fed generating facility of the Lopez group – the 414MW San Gabriel plant cannot shift its usage to liquid fuel, forcing the plant to temporarily shutdown.
It was conveyed by Manila Electric Company (Meralco), off-taker or capacity-buyer of the generated electricity of the First Gen plants, that “about 1,900MW of its gas-fueled contracted capacity are no longer supplied with gas by the Malampaya field.”
In the case of the 1,200-megawatt Ilijan gas-fired power facility, its generation has been limited to 360MW because that’s the only level of gas supply funneled into it by the Malampaya field. That resulted then in 840MW of capacity being taken out from the system.
As of press time, there is no clear information provided by the government or the Department of Energy (DOE) yet up to when the gas supply snag will last and how will this affect both the country’s power supply and resulting electricity rates to be billed to consumers.
As gathered from Malampaya operator Shell Philippines Exploration B.V. (SPEX), “the offshore platform conducted some maintenance over the weekend, which impacted on gas supply delivery to First Gen.”
Given the sudden shift of the gas plants to imported liquid fuels, alarm bells are being raised that such distress in the country’s gas supply will result in electricity tariff hikes in the next billing period because liquid fuel is more costly than the gas drawn out from Malampaya.
Apart from rate spikes, fears are likewise being heaved up that available power supply will suffer tightness — and that could trigger unwarranted climbs in settlement prices at the Wholesale Electricity Spot Market.
Meralco Vice President and Spokesperson Joe Zaldarriaga said “ we will need to assess what the price implications will be both on the shift to liquid fuel and overall supply as well.”
He further stated “for now, we have no information as to when this reported shutdown will last, but rest assured that we will work closely with all the industry players involved.”
The scheduled preventive maintenance shutdown of the Malampaya facility will be next month (October 2-22), hence, that is the expected timeframe when the field stops supplying gas to the power plants and for them to shift to other fuels.