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DOE issues circular adopting new rules on downstream natural gas industry

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By Alena Mae S. Flores – January 31, 2024, 9:35 pm
from manilastandard.net

The Department of Energy (DOE) said Wednesday it adopted the amended rules and regulations governing the downstream natural gas (DNG) industry.

It issued Department Circular DC 2024-01-0007 signed by Energy Secretary Raphael Lotilla on Jan. 12, 2024 prescribing the requirements for the issuance of permits to operators for the construction of DNG facilities.

The circular aims to provide a conducive environment for the development of the DNG industry and promote financial liability by liberalizing the entry of investors and encourage access to capital and off-taker market under a transparent, competitive and fair trade system.

It seeks to ensure the transparent pricing of natural gas and rates for its importation, storage, regasification, transmission and distribution.

The DOE said the procurement, delivery and pricing of natural gas from importation and from indigenous production should be transparent, competitive and secure.

It said DNG facilities may be designed and constructed to accommodate indigenous gas, imported liquefied natural gas or both.

The circular said the DOE should support the optimal supply and use of natural gas, especially indigenous sources, including, as may be necessary, the priority dispatch or sourcing of indigenous natural gas.

The DOE may also mandate the blending or aggregation of imported LNG and indigenous natural gas and/or enforce the priority source of indigenous gas for power generation.

It said the entire capacity of a DNG facility may be offered to third party. The negotiated third party access refers to a commercial arrangement which allows the operator and a third-party end-user or affiliate to agree and execute negotiated terms and conditions for the use of the DNG capacity.

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