MANILA, Philippines — President Ferdinand Marcos Jr. signed into law a measure establishing a framework for the development of the country’s natural gas industry to promote natural gas as a safe, efficient, and cost-effective source of energy.
Marcos signed Republic Act (RA) 12120 or the Philippine Natural Gas Industry Development Act on Jan. 8, 2025, a copy of which was uploaded to the Official Gazette on Tuesday.
The new law seeks to establish the Philippine Downstream Natural Gas Industry (PDNGI) and increase the share of natural gas in the country’s energy mix by promoting it as a safe, efficient, and cost-effective source of energy and an indispensable contributor to energy security.
RA 12120 will also promote the conversion of the existing fossil-fuel operated equipment and facilities to natural gas use; provided, that the conversion is technically and financially feasible.
Under the new law, the Department of Energy (DOE) shall be the lead agency to determine the need for and regulate the development of aggregation in the country.
Aggregation is defined as the procurement of indigenous natural gas, combining it with imported LNG, and selling the aggregated gas to gas buyers in the Philippines or abroad.
The DOE is also authorized to evaluate, approve, and issue the permits necessary for the siting, construction, operation and maintenance, expansion, modification, rehabilitation, decommissioning, and abandonment of any PDNGI facility or activity.
The operation of the PDNGI facility shall undergo an evaluation process for possible inclusion and entitlement of incentives under the Strategic Investment Priority Plan.
The law stated that the PDNGI facilities could be designed and constructed to ensure the accommodation of both indigenous natural gas and/or imported natural gas, pursuant to the guidelines of the DOE.
Regulations shall be consistent with applicable Philippine and internationally accepted natural gas industry standards, the law indicated.
The law will also facilitate the development of power and non-power end-uses of natural gas, which includes commercial, industrial, residential, and transport applications that promote fuel diversity.
RA 12120 is seen to help the country meet the increasing domestic demand for fuel and develop the Philippines as a liquified natural gas trading and transshipment hub in the Asia-Pacific region.
Before Marcos signed RA 12120, the measure was passed by the Senate on Nov. 11, 2024, and adopted by the House of Representatives on Nov. 13.
The new law will take effect 15 days after its publication in the Official Gazette, with the DOE expected to promulgate its implementing rules and regulations within six months.
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