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Philippines LNG investments face exposure to $14 billion in stranded assets

May 06, 2021

The Manila Times:

A new report from the Institute for Energy Economics and Financial Analysis (IEEFA) revealed that investments in developing liquified natural gas (LNG) facilities in the country will face negligible development risks, particularly exposure to $14 billion in stranded assets, amid regulatory and financial uncertainty in the Philippines market.

Sam Reynolds, the report’s author and IEEFA Energy finance analyst, highlighted that the race to develop LNG facilities in the Philippines has gone from a marathon to a sprint but potential LNG investors must proceed at their own risk.

“Officials in the Philippines have endorsed a rapid build out of LNG import infrastructure due to the anticipated depletion of the Malampaya deepwater development, the country’s only domestic source of natural gas, and high GDP (gross domestic product) growth expected over the next decade,” said Reynolds.

In the report, he noted that exporting countries and industry players have pushed the narrative that natural gas represents a viable transition fuel from coal to renewables. The United States, in particular, has encouraged legal and regulatory reforms to stimulate LNG demand creation. 

[Eireene Jairee Gomez]

More: LNG investments face some risks

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