THE national treasury expects to rake in P20.2 billion in royalties from the Malampaya natural gas field this year, Surigao del Sur Rep. Johnny Pimentel said on Tuesday.
“The amount is P5.7 billion, or 22 percent, less than the P25.9 billion in gas royalties that the government earned from Malampaya in 2022,” Pimentel said.
“The government anticipates receiving lower royalties from Malampaya between now and 2026 on account of shrinking gas output from five existing production wells,” Pimentel said.
The estimated future royalties from Malampaya have been tapered to P13.5 billion in 2024, P8.5 billion in 2025, and another P8.5 billion in 2026, Pimentel said, citing figures from the government’s Budget of Expenditures and Sources of Financing for 2024.
“These are all approximate calculations. The actual royalties could still end up higher. In fact, the government was expecting only P24.3 billion in royalties in 2022, but the actual money that came in was P25.9 billion, or higher by P1.6 billion,” Pimentel pointed out.
Even with the predicted drop in royalties due to falling output from existing wells, Pimentel expressed confidence that the Malampaya consortium “will eventually be able to find and extract additional gas supplies from upcoming new wells.”
Pimentel previously served as chairperson of the House committee on strategic intelligence. He is also author of House Bill No. 1782, which seeks to appropriate an initial P5 billion for the installation of new naval forward operating bases to secure the West Philippine Sea’s vast oil and gas deposits for the enjoyment of future generations of Filipinos.
Additional gas output by 2026
Located offshore, 65 kilometers northwest of Palawan, Malampaya’s existing production wells have been yielding gas for the last 21 years and might be depleted by 2027, based on previous projections.
Energy Secretary Raphael Lotilla had earlier said that the Malampaya consortium is on track to start drilling new wells by the end of 2024, with additional gas production seen by 2026.
The consortium is led by businessman Enrique Razon Jr.’s Prime Energy Resources Development B.V., which has a 45 percent operating interest in the service contract.
Businessman Dennis Uy’s UC38 LLC holds the other 45 percent, while the state-owned PNOC Exploration Corp. owns the residual 10 percent.
Malampaya currently supplies gas to power plants Batangas that generate up to 20 percent of the country’s energy requirement.
The gas is delivered onshore via a 504-kilometer-long undersea pipeline.