Seoul, Manila to increase energy cooperation

The Philippine Government and the Korean Government today signed three deals to further strengthen bilateral cooperation in the energy sector between the two countries.

 The two MOUs signed by Philippines Energy Secretary Raphael P.M. Lotilla (left photo below) and Republic of Korea’s Ministry of Commerce, Industry and Energy (MOCIE) Minister Lee, Hee-Beom aims to assist the Philippine government in its power development programs and accelerate the country’s barangay electrification program while the third MOU signed by the Philippine National Oil Company (PNOC) and Korea Gas Corporation (KOGAS) aims to promote the development of the country’s downstream natural gas industry.

The signing held at the Manila Hotel is a sideline event of the State Visit of Korean President Roh Moo-Hyun (shown with President Arroyo top photo).

Under the MOU on Power Development, MOCIE through the Korea Electric Power Corporation (KEPCO), will expand its existing Ilijan Power Plant located in Ilijan, Batangas City as a merchant facility. The DOE, on the other hand, will  assist in securing necessary clearances and permits and facilitating discussions among stakeholders to realize the construction and operation of the new KEPCO capacity.

Meanwhile, to help accelerate the country’s barangay electrification program, KEPCO commits to energize 500 barangays through a $15 million grant over a five-year period. This is on top of the 202 barangays KEPCO energized last year.

As of October 31, 2005, 7% of the 41,945 barangays all over the country still need to be energized.

For the development of the country’s downstream natural gas industry, PNOC President Eduardo V. Manalac and KOGAS President Lee Soo Ho commit to enhanced cooperation in the downstream natural gas industry given KOGAS’ strength in the gas business both in Korea and overseas while the Philippines is raring to take off with the development of its downstream natural gas sector.

Under the MOU, both parties agreed to share information on the gas industry in both countries, including managerial and technical information, and potential business opportunities in both countries. The MoU also enables both countries to jointly study and assess possibilities of cooperation for potential business opportunities, technical studies, training and patents and licensing.

Natural gas is considered as the fuel of the 21st century and ranks as the most environmentally-friendly fuel. Projections by the DOE show that the demand for natural gas will pick up in the coming years. By next year, upon commissioning of the anticipated mother-daughter CNG refueling station by Shell Philippines, at least 200 buses fueled by natural gas are expected to ply the Manila-Batangas and Manila-Laguna route.

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