MANILA – Liquefied natural gas (LNG) can bridge the gap between traditional fuel sources like coal, and renewable energy (RE), Energy Secretary Alfonso Cusi told ministers attending the 35th ASEAN Ministers on Energy Meeting (AMEM35) Wednesday.
Cusi noted that while technological advances in RE are evolving, the need for a stable and secure energy source is increasing.
“While sustainable RE will come to dominate the future, there is still a need for a stable source of electricity that can bridge this transition. Without this, we will not be able to secure our energy security,” he said in his welcome address during the joint opening ceremony of the AMEM35 and Associated Meetings and the ASEAN Energy Business Forum, held at the SMX Convention Center in Pasay City.
The energy chief said he believes that LNG is revolutionizing the energy sector as it is a stable resource that can provide the region’s energy needs in the short and medium term.
Three major developments define this revolution, he said.
The first is increasing demand from Asia where players will eventually transition from net exporters to net importers. Second, LNG supply is increasing in the rest of the world, especially the United States. Third, LNG is cheaper and changes in the supply and demand mechanics pushes costs down further.
Cusi explained that the thirst for gas is set to grow further and demand for LNG is highest in Asia, with Chinese LNG imports jumping 38 percent in the first half of the year, compared to the same period in 2016.
According to forecasts made by British Petroleum, China and India alone are expected to account for half of the 30-percent increase in global energy demand between today and 2035. The same trends are happening in ASEAN, where the situation is such that as gas fields continue to deplete, the region will eventually transition from net exporters to net importers, he said.
Cusi also cited the Oxford Institute for Energy study which sees that by 2021, ASEAN countries will be net importers requiring 20 million tons. This is set to rise to at least 45 million tons in 2030.
As demand continues to grow, things look promising on the supply side as well, the Philippine energy chief said, adding that global supplies of LNG are expected to increase by 50 percent between 2014 and 2021.
“Given these new developments, ASEAN needs to start planning for this future. We need to think of how we can ride this LNG wave, to ensure that we can safeguard our energy security. We’ve started doing just that in the Philippines, with the rollout of the Batangas LNG Terminal by 2020 to safeguard against the anticipated depletion of the Malampaya gas facility in 2024. The buy-in is there. The investors are in. And we expect to commence groundbreaking of this project in 2018,” Cusi said.
On the regional front, he noted that plans for the Trans-ASEAN Gas Pipeline (TAGP) to ensure the movement of gas around the region, with pipelines linking Singapore, Malaysia, Thailand, Myanmar and Indonesia, would benefit member countries, reducing costs of transporting LNG.
Cusi said Southeast Asian nations could soon double import capacity for LNG as domestic energy sources fall short, collectively becoming a key player in the global LNG market.
This, he said, will see the region boosting its annual LNG receiving capacity from 25 million tons to some 50 million tons in the next five years.
The expanded figure equates to about 20 percent of the LNG carried on tankers worldwide in 2015. (PNA)