Malampaya’s PH Royalty Reaches $ 11.7 Billion

The Philippine government’s share of royalties from the Malampaya project operations has so far reached $ 11.7 billion, significantly higher than the estimate of $ 8 billion when the gas field began commercial operations in 2001.

Data showed that the latest figure was $ 700 million higher than the $ 11 billion in 2019 when the last report was made around August of last year.

In 2018, remittances to the state were reported to have reached $ 9.709 billion, and the government’s cash yield increased by $ 553.54 million in 2017.

Over the years, the government revenue share of that billion dollar gas field company had been: $ 432.75 million in 2016; $ 445.48 million in 2015; $ 899.70 million in 2014; $ 846.50 million in 2013; $ 1,112 billion in 2012; $ 1,134 billion in 2011; and $ 741.10 million in 2010.

In previous years, Malampaya’s revenue stream that flowed into the state coffers had been: $ 675.20 million in 2009; $ 1.050 billion in 2008; $ 706.40 million in 2007; $ 496.90 million in 2006; 197.10 million dollars in 2005; 162 million dollars in 2004; 148.60 million dollars in 2003; $ 116.10 million in 2002; and $ 10.30 million in 2001.

However, government profits fell in the years 2013 to 2015 because the Malampaya consortium had most of the cost recoveries from the additional $ 1 billion investment channeled for the installation of the new platform that boosted gas production from the countryside.

Cost recoveries had increased to $ 481.30 million in 2013 from $ 296.30 million a year earlier.

In 2014, cost recovery was $ 400.60 million; and it was $ 489.51 million in 2015; then it started to drop again to $ 338.72 million in 2016; then to $ 287 million in 2017.

However, industry sources noted that the government’s share of royalties from the Malampaya project had exceeded projections of $ 8 billion at the start of commercial operation of the field in 2001.

The 25-year contract for the Malampaya field will expire in 2024. This means that the government still has four more years to rake in significant dollar revenues.

As could be deduced from recent years, the scale of remittances from Malampaya to the state coffers had been hovering between $ 800 million and $ 1.1 billion annually, only less in years when the costs of the remittances were being recovered. investments and in the initial years of gas production. .

There have been previous stipulations from both the Department of Energy (DOE) and the Malampaya consortium that the gas field’s production life cycle could still be extended by 5-6 years but that will already depend on the decision of the Shell buyer. participation in the project. The government had not taken action on the Malampaya consortium’s license extension request, and now uncertainties are compounded by the change in ownership, especially with the early departure of the current field operator.