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Wednesday, August 23, 2017 26° Cloudy

‘Oil is not forever’

Published

By Elinando B. Cinco

Elinando B. Cinco

Elinando B. Cinco

While presiding over the monthly meeting of the Organization of Petroleum Exporting Countries in Stockholm, Sweden, in December, 1986, Shiek Ahmed Zaki Yamani, oil minister of Saudi Arabia, then the cartel’s president, told the stunned oil-consuming world:

“Oil is not forever. You have just seen the end of cheap oil.”

Three days after that ominous warning, the price of crude oil in the world market spurted from $12.70 to $18.00 per barrel. From then on the price of the black gold has not stopped soaring.

The reality that was sparked by OPEC 34 years ago is still hounding not only consumers but energy producers as well, making the entire energy industry constantly shudder in fear.

The oil-consuming world responded with their first line of defense – sensible conservation in the use of the commodity. And, second, exploring all possible cheaper oil alternatives.

With the expected drying up of the Middle East oil fields, what significant strides has the local energy sector done to develop cheaper and readily available fuel substitutes?

Which brings us to unavoidable bigger issues which face the Philippine energy industry.

First of all, the energy industry clearly lacks fuel alternatives. Most power plants are fuelled by oil, or liquid condensate, which are high-priced. Few generation plants offer cheaper alternatives like natural gas.

The energy sector needs to work together to promote a more diverse and balanced energy mix through power generation plants powered by natural gas facilities, coal, and renewable energy.

The increase in power rates is just the tip of the iceberg. The energy sector needs to be united in mapping out the future of energy sources in the country.

Businesses, and the economy, will suffer immensely if power shortages caused by incidents such as the Malampaya shutdown are not immediately addressed.

Power/electricity is a key unifying element in all major industries. It drives the economy and should take priority in development and access for the growth of the country.

The instability of our current power plants continues to worsen and is starting to affect the Luzon grid.

As a country that’s rich in natural resources, we have a huge, untapped reserve of natural gas resources.

The major energy sources that the RP can look into are solar/renewable energy, natural gas, hydropower, and geothermal energy.

The energy sector needs to encourage investments for varied energy sources to secure the future of energy supply in the country.

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