President Ferdinand “Bongbong” Marcos Jr. signed Republic Act 12120 or the Act Promoting the Development of the Philippine Natural Gas Industry Act on 8 January 2025, a landmark measure for the country’s energy security.

The measure, which was uploaded to the Official Gazette on Tuesday, seeks to promote natural gas as a safe, efficient, and cost-effective source of energy and an indispensable contributor to energy security by establishing the Philippine Downstream Natural Gas Industry (PDNGI) for the benefit of all segments of the nation’s populations.

The law aims to develop natural gas as a reliable fuel for power plants capable of addressing the peaking, mid-merit and base load demand of the country to help achieve energy security, while progressively transitioning to renewable energy sources.

The Department of Energy (DoE) will draft the Implementing Rules and Regulations within six months after the law’s publication in the Official Gazette.

Transition fuel

Principally authored and sponsored by Senate Energy Committee Chairperson Senator Pia S. Cayetano, the Philippine Natural Gas Industry Development Act aims to enhance energy security for future generations by creating an investor-friendly environment that encourages the exploration of indigenous natural gas resources.

The new law positions natural gas as a transition fuel toward renewable energy while addressing the country’s long-term power supply challenges. It also includes provisions ensuring transparency and fair pricing for consumers, effectively balancing energy security and consumer welfare.

Citing the stability and generally lower prices of indigenous natural gas compared to the volatility of imported sources, Cayetano emphasized that securing a steadier, more reliable local supply will reduce our vulnerability to global disruptions and address future energy demands.

“With more than half of our energy requirements being imported, we are clearly vulnerable to geopolitical conflicts,” the senator said, stressing the need to address our country’s energy security. To illustrate this vulnerability, Sen. Cayetano highlighted records showing the volatility of imported natural gas, noting its price fluctuations over the past 14 years, which surged significantly during the Ukraine war.

“Also based on the Energy Department’s 2022 Primary Energy Mix, 63.2 percent of our energy comes from oil and coal. As the country moves towards renewable energy sources, we need to find additional baseload resources, aside from oil and coal, which are less harmful to the environment,” she further noted.

“Malampaya was supposed to be the first of many producing gas fields in the Philippines, but it turned out to be the only one. The country needs more Malampayas: we barely have one left,” added the senator.

“With this law, we empower families, we empower the Filipino people,” she concluded.