The Philippines through the Department of Energy (DOE) and state-owned Philippine National Oil Co.-Exploration Corp. (PNOC-EC) today sealed agreements with the Indian Government through Gas Authority of India Limited (Gail) to establish strong cooperation in the development of the Philippine natural gas industry from gas exploration to gas retailing.

The memorandum of understanding (MOU) between the DOE and GAIL would enable both parties to pursue cooperative programs and projects covering compressed natural gas (CNG) development and other downstream use of natural gas.

Particularly, the agreement would allow scientists and experts of both countries to embark on joint education and research as well as information networking in conducting extensive studies on the development of the downstream gas industry.

The MOU was signed by Energy Secretary Vincent S. Perez (left photo) for the Philippines and Proshanto Banerjee, GAIL chairman and managing director.

GAIL is one of India ’s leading public sector enterprises with a 92 percent gas market share. It operates more than 4,500 kilometers long gas transmission and marketing infrastructure, seven gas processing plant, four gas-based petrochemical plants and a 1,250 km. long cross country LPG transportation pipeline.

The memorandum of cooperation (MOC) between PNOC-EC and GAIL, on the other hand, will pave the way for cooperation in the development of natural gas in the retail gas marketing area and transport sector.

PNOC-EC president Rufino B. Bomasang and Mr. Banerjee signed the MoC.

Secretary Perez expressed sincere gratitude to the Indian government for its strong support in helping the Philippines tap its natural gas resource and clean the environment.

He noted that the Philippines at present is at the same position India was in the 1990s when it was still developing its natural gas industry.  The worsening pollution problem in India triggered the widespread utilization of natural gas in the country particularly in the transport sector.

To date, a total of 14,000 public utility buses are now running in natural gas in New Delhi , India on a country-wide basis, a total of 170,000 public utility buses are fueled by natural gas.

Mr. Banerjee said the contribution of the natural gas as a fuel source in the energy basket in India will more than double to 15 percent from the present seven percent in 10 to 15 years.

Given the proper planning and coordination among stakeholders and a strong political will, Mr. Banerjee said he is confident that the Philippines will achieved the same feat as with India.

“We are very glad to share our experience with other countries that have the same problems we had. I am confident that four years from now we should look forward to the more extensive use of natural gas in the Philippines and a cleaner and greener Metro Manila,” Mr. Banerjee said during the signing.

“We are just starting our first steps in the development of the natural gas industry. We have made several milestones. I am assuring everyone that there is a political will to push this program,” Secretary Perez said.

The agreements further boost the Government’s initiatives to promote natural gas as a secure, stable, economically efficient and environmentally friendly source of energy.

President Arroyo early (left photo) this year issued Executive Order 66 designating the DoE as the lead government agency in ensuring a unified and coordinated efforts towards establishing a successful and robust Philippine natural gas industry.

In particular, the implementation of the Natural Gas Vehicle for Public Transport Program (NGVPPT) has been bolstered with the recent signing of two agreements - MOU between the DOE and the Department of Transportation and Communication identifying and opening new routes exclusively for natural gas vehicles, among others and the MOU between the DOE and  Pilipinas Shell Petroleum Corp. and the Malampaya consortium composed of Shell Philippines Exploration B.V. (Spex), Shell Philippines LLC, Chevron Texaco Malampaya LLC and PNOC-EC for a seven-year pilot project for the establishment of natural gas refilling stations.