The Department of Energy (DOE) and the Philippine branch of Synergy International Resources Group Co., Ltd. recently signed a Memorandum of Understanding (MoU) for cooperation in the development of Compressed Natural Gas (CNG) infrastructure in the country.

Under the MoU, Synergy has committed to invest US$ 200 million for the establishment of CNG refueling system for the whole Metro Manila area for CNG utilization in transport. The CNG refueling system includes mother-daughter refilling stations, mobile refueling facility and other facilities deemed necessary. Feasibility study for the establishment of a CNG refueling system shall commence not later than March 1, 2006.

Synergy likewise committed to provide technical and operational expertise to the DOE and other concerned agencies to support the transition of the transport sector to a CNG fuel base. This includes refueling facilities and other related facilities and equipment to convert land and marine transportation from gasoline or diesel to CNG.

Synergy has over 25 years experience in the design, building, deployment and operation of CNG and Liquified Natural Gas (LNG) equipment technology and methodologies in China. Their main office is located in Schenzen, China.

Meanwhile, the DOE shall provide assistance in the preparation of relevant study on the viability of Synergy�s investment in the Natural Gas Vehicle Program for Public Transport (NGVPPT). The DOE shall likewise evaluate Synergy�s application for accreditation as CNG Refueling Station Operator and Manufacturer/Assembler of NGVs.

Department Circular No. 2004-04-004 states that participants in the NGVPPT shall file an application for certificate of accreditation (CA) from the DOE. Qualified applicants may be categorized under Manufacture/Assembly of NGVs, Operation of NGVs, Retrofit/Conversion of NGVs and CNG Refueling Station Operation.

DOE-EUMB Director Mario Marasigan (photo left) acknowledged Synergy�s strong interest in participating in the NGVPPT, citing that �With this MOU, we hope to enhance the implementation of our NGVPPT through greater public access in the natural gas transport system.�

Marasigan added that the promotion and increased utilization of alternative transport fuels such as natural gas will consequently lessen the country�s dependence on imported fuel especially at a time of surging oil prices. The transport sector consumes about 53% of the total imported oil requirements.

In October 2002, the government launched the Natural Gas Vehicle Program for Public Transport (NGVPPT). The NGVPPT lays down the government policies in the downstream natural gas market to encourage active private sector participation and create a healthy competitive environment for all players.

Specifically, the NGVPPT program gives a package of incentives to participants which includes income tax holiday for pioneering projects qualifying under the BOI�s Investment Priorities Plan; zero rate duty on imported NGV industry related equipment, facilities, parts and components; preferential and exclusive franchises from LTFRB for NGVs on newly opened routes; accelerated issuance by the DENR of Environment Compliance Certificate (ECC) for NGV facilities and refueling stations; affordable and commercially tenable financial packages from GFIs, among others.

Last July 2005, the DOE likewise issued Department Circular No. 2005-07-006 providing open access to the natural gas sourced or produced from future or existing petroleum service contracts such as the Malampaya and the San Antonio, Isabela gas fields.

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.