Monday, July 20, 2015

Philippines: Malampaya Natural Gas Project

The Malampaya gas field is a natural gas field located in the West Philippine Sea. It was discovered in 1992 and developed by Shell Philippines Exploration B.V. Royal Dutch Shell now operates it on behalf of partners Chevron Corporation and Philippine National Oil Company Exploration Corporation. The field began production in 2001 and produces natural gas and natural gas condensate. The total proven reserves of the Malampaya gas field are around 3.7 trillion cubic feet (105 km³), and production is slated to be around 410 million cubic feet/day (11.7×105m³).


The area surrounding the Spratly Islands is said to be rich in yet unexplored oil and gas fields, and hence, remains controversial. The Philippines began exploring the areas west of Palawan for oil in 1970. Exploration in the area began in Reed Bank/Tablemount (Reed Bank is the largest seamount within the Spratly Islands)in 1976, gas was discovered following the drilling of a well.However, China's complaints halted the exploration.

Today, Malampaya oil platform is the only operational oil platform in the Philippines. It is extracting natural gas from the Camago-Malampaya oil leg (CMOL) (or simple Malampaya Field), located 80 kilometres (50 mi) west of northern Palawan. It is not claimed by other countries. It contains 3.7 trillion cubic feet (1.0×1011 m3) of natural gas reserves. The Malapaya Project began the Philippines' natural gas industry and enabled the supply of at least 2,700 megawatts of power for a period of at least 20 years starting 2002.[8] In December 2001, an extended well test of the thin oil rim beneath the field initially yielded about 8 million barrels (1,300,000 m3) of oil per day (bpd). It is also believed to be the deepest horizontal subsea well test undertaken in the world at a depth of about 850 m.

The upstream component of the $4.5 billion USD Malampaya gas-to-power project was jointly developed by Shell Philippines Exploration B.V. (SPEX), ChevronTexaco and PNOC EC. The project was formally inaugurated on October 16, 2001. Shell Philippines Exploration owns 45% of the project, ChevronTexaco owns 45% and PNOC-EC owns 10%.Malampaya is expected to provide substantial long-term revenue of between $8–10 billion USD to the Philippine government over its life span. Other sites eyed by PNOC-EC west of Palawan are the Calamian, West Calamian, West Balabac, and East Sabina sites.

Another oil field being explored today is Reed Bank, which exploration was halted in 1980's after China's objections. The concession is currently awarded to Forum Energy plc, a UK-based oil, gas and coal company. The Reed Bank concession is located in the South China Sea west of Palawan Island. The licence is located to the southwest of the Shell-operated Malampaya Gas Field.Unlike Malampaya, Reed Bank is claimed by the People's Republic of China, Republic of China, and Vietnam. There is still no news on whether these countries are disputing this exploration or not. In March 2011, two Chinese vessels chased off the Veritas Voyager, a survey ship hired by Forum Energy—a UK-based company with a portfolio of projects in the Philippines. Forum Energy intends to return to Reed Bank in 2012 to explore for energy resources. The U.S. military has also signalled its return to the area, with war games scheduled in March with the Philippine navy near Reed Bank.


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