Shell to establish renewable energy firm next year

By on December 19, 2017

A top official of Pilipinas Shell said a renewable-energy (RE) unit could be put up next year, Business Mirror reported Dec. 10.

“We are in the process of setting it up. Maybe next year, it should be ongoing,” said company president Cesar Romero, who added that “Shell group, Shell International,” in particular, “plus a local partner,” will put up the RE firm.

Romero said it is a challenge to set up a company with partners involved “because we are foreign, we need a 60-percent Filipino partner. You have to work with a partner, come up with a JV [joint-venture] arrangement.”

He said discussions are being held with a prospective local partner.

“When you set up a company with partners, it’s a bit tricky,” Romero added. One intent of the RE venture is to differentiate itself from other RE providers, he explained.

“The vision is not necessarily anchored on setting up a generation facility but a combination of hybrid RE,” Romero said. “It’s a blended energy with renewable component. It’s not only going to be solar. We won’t be traditional solar installer.”

Shell has recently informed the National Renewable Energy Board (NREB) it is joining the RE bandwagon soon.

“Shell will enter the RE sector,” NREB Chairman Jose Layug announced in October. “They will start vey soon. It’s high time they did it. We welcome this,” Layug added in an interview when asked to elaborate on Shell’s plans.

No particular RE power source was committed to NREB, Layug said, adding that Shell is “open to any RE” and that “they will start looking for potential RE source.”

RE includes solar, hydro and wind, among others.

Shell had earlier announced that it was exploring various business models in preparation for its new investment in RE, following its parent firm’s announcement that it has established a separate division, New Energies, as a conduit to invest in renewable and low-carbon power.

“We believe we need to make a contribution toward a sustainable future. Part of that thrust is going toward low-carbon footprint,” Romero earlier said. “Oil will continue to play an important role. We are also pushing gas extensively.”

The oil business of the company is under Pilipinas Shell Petroleum Corp.

Meanwhile, Shell Philippines Exploration BV is the upstream company of Shell in the Philippines in charge of operating the Malampaya Deep Water Gas-to-Power Project.

The Malampaya gas field in offshore Palawan supplies natural gas to two more power plants in Luzon—the 1,000-MW Santa Rita and the 500-MW San Lorenzo power plants, both owned by the Lopez group.

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