Last year, the Department of Energy (DOE) stamped its confidence on Malampaya with the drilling of three new wells, promising fresh gas flows from the country’s only commercial field starting this 2026.

The drilling timetable had slated October–November 2025 as the completion date; yet months later, questions linger as the DOE and the Prime Energy-led Malampaya consortium remain publicly tight-lipped on the outcome.

Equally absent are hard answers regarding the start date of new gas production and the true volume of recoverable gas remaining in the country’s sole commercial field.

With Service Contract 38 (SC 38) for Malampaya extended for 15 years (from February 2024 to February 2039) by the Marcos administration, the aim is clear: to prop up Malampaya’s waning production and postpone its anticipated depletion in 2029. However, that goal has yet to be indisputably proven.

The anticipated grand announcement of Malampaya’s drilling results never came. Instead, industry sources have hinted at a ‘tight hole’ situation—a shrouded outcome that raises more questions than answers. These industry whispers have been affirmed by well-placed sources within the DOE and even from Malampaya’s minority shareholder, the state-run Philippine National Oil Co.-Exploration Corp. (PNOC-EC).

Within the exploration and production (E&P) sector, a ‘tight hole’ is industry code for confidentiality—a drilling phase where operators deliberately lock away details like depth, formations, and data under the guise of protecting competitive interests.

Industry experts point out that a ‘tight hole’ designation is routinely applied when drilling runs into physical barriers or technical extraction hurdles, primarily in high-risk or ‘wildcat’ wells. This gives operators cover to guard sensitive geological data and proprietary drilling methods from prying competitors.

However, in the case of Malampaya, the logic of invoking “competition” falls apart under scrutiny. The country has only one commercial gas field: Malampaya itself. This stirs the unavoidable question: why should drilling results be withheld from the public when there is no competitor to protect against? What purpose does this secrecy truly serve?

Beyond projections of future production, the DOE faces pressing questions that demand public clarification—specifically, whether the drilled wells were classified as ‘production’ or ‘exploratory.’ This distinction directly determines the scope of cost recovery the Malampaya consortium can claim against its invested capital.

In the all-or-nothing realm of exploration, particularly for ‘wildcat’ wells, the field operator assumes the full risk. A failure to strike commercially viable reserves could mean forfeiting the claim to recover costs.

Conversely, when wells are classified as ‘production,’ cost recovery shifts from a gamble to an entitlement. Once a commercial discovery is declared, the contractor can reclaim invested costs from a portion of produced petroleum—typically capped at 70% or as provided under the service contract—with any excess costs carried forward.

As the Malampaya Phase 4 project rolls out with a hefty $893-million price tag, which slices of that spending will the consortium recover, and what share will Filipino consumers end up footing in their electric bills?

First and foremost, the gas flowing from Malampaya is a state-owned resource. The Malampaya consortium members are merely contractors tapping into what rightfully belongs to the Filipino people.

Oil and gas are national treasures. Only transparency in exploration and production allows citizens to judge whether private contractors and government officials are managing them responsibly. When data is hidden, accountability disappears; those in charge cannot be held to answer for their actions.

Furthermore, making production levels and discoveries public ensures that royalties, taxes, and other payments to private contractors are calculated correctly. This reduces the potential for corruption and ensures the country actually reaps the financial benefits of its natural resources.

Beyond the numbers, local communities hosting the project have an undeniable right to know what is happening in their area, especially when it impacts their water, health, or livelihoods. Public disclosure empowers them to anticipate risks and demand necessary safeguards.

Crucially, knowing the scale of discoveries helps a country viably plan infrastructure, employment opportunities, and long-term development, rather than stumbling along on speculation or guesswork.

Globally, the playbook is clear: misreporting or withholding E&P data is not tolerated. In many energy markets, violators—whether governments, corporations, or the individuals pulling the strings—have been brought to justice or hit with legal claims.

In practical terms, what happens in Malampaya doesn’t stay in the field. Its gas production is used by power plants for electricity generation; therefore, every peso or dollar spent—or hidden—will ultimately hit consumers via their electric bills.

Specifically, Republic Act No. 12120, or the Philippine Downstream Natural Gas Industry Development Act, sets clear rules for indigenous gas: priority dispatch and a mandated minimum electricity share from Malampaya. Early estimates caution that if these plants aren’t tied to bilateral contracts, policy slipstreams and legal blind spots could drive spot market prices higher by as much as ₱2.00 per kWh—costs Filipino consumers would ultimately bear.

Additionally, indigenous gas used in power plants is accorded a Value Added Tax (VAT) exemption, a measure designed to lower electricity costs. These savings must flow straight to the ratepayers.

But when data on a national resource is concealed, there is no way to verify if the gas powering our plants is genuinely from Malampaya or discreetly substituted with imported Liquefied Natural Gas (LNG). This casts a shadow of doubt over accountability and the cost impact on consumers. What signal does this send to industry competitors, particularly those fully dependent on imported LNG?

Will regulators actually enforce proper checks and audits before these costs are passed on to consumers? We, the Filipino people, as the rightful owners of the Malampaya reserves, are waiting for clear answers.

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