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Davao Oriental sets up oil palm dev’t program

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BusinessWorld Online
Carmelito Q. Francisco
February 25, 2015

DAVAO CITY — Davao Oriental province is edging into oil palm production, starting off with the development of 1,500 hectares of farms previously planted to coconut that were devastated by typhoon Pablo (international name: Bopha) in December 2012.
P5 million was initially allocated by the provincial government to set up the Davao Oriental Oil Palm Industry Development Project as part of the local agricultural program.

Provincial Agriculturist Rotchie M. Ravelo said oil palm has been assessed to be suitable for the appointed farm lands and a more secure crop option for these areas which have been dependent on coconut before the typhoon, the strongest to hit the Davao Region in 30 years.

An estimated six million coconut trees were destroyed by typhoon Pablo, mostly in Davao Oriental and Compostela Valley.

Davao Oriental’s coconut production dropped from more than one million metric tons (MT) in 2012 to only 693,414 MT in 2013, based on data from the Bureau of Agricultural Statistics (BAS).

For oil palm, Davao Oriental had no recorded production as of 2013 while Compostela Valley had a minimal 2,335-MT harvest.

The Philippine Coconut Authority has drafted the first oil palm industry road map for 2014-2023 with a goal of developing 300,000 hectares of farms across the country and setting up a milling capacity of 500 tons per hour.

As of 2014, the Philippines had about 73,000 hectares planted to the crop, based on data from the Philippine Palm Oil Development Council, Inc. (PPDCI).

In a paper co-presented by PPDCI officials Pablito P. Pamplona and April Grace D. Pamplona during the Malaysian Palm Oil Council Forum on Malaysian Palm Oil held in Cebu City in August last year, Mindanao and southern Visayas were identified as highly suitable for the crop with a potential area of one million hectares.

BAS 2013 data show the Soccskargen Region led in oil palm production with 143,674 MT, followed by the Caraga Region with 136,371 MT, then the province of Maguindanao under the Autonomous Region in Muslim Mindanao with 106,528 MT.

Oil palm is used in various products, including cooking oil and snacks, cosmetics, and biodiesel fuel. However, palm oil prices on the global market have been on a downtrend due to high supply and reduced demand given increased competition from alternative products.

Indonesia and Malaysia are the two biggest oil palm producers.

CATEEL
Among the first areas to be covered by Davao Oriental’s new program is the town of Cateel, one of the three municipalities hardest hit by typhoon Pablo.

“Other towns will also be considered for the crop,” Mr. Ravelo said.

About 100 farmers in Cateel will be given farm inputs, including seedlings, as well as training on oil palm production.

In an earlier interview, Davao Oriental Governor Corazon N. Malanyaon told BusinessWorld that oil palm is one of the crops, along with cassava and rice, that the provincial government intends to develop to fill the void left by the devastation of its coconut industry.

The local government is looking at developing an additional 2,200 hectares for rice, which will covered by a new irrigation system in Cateel, built at a cost of P281 million through funding from the World Bank under the Mindanao Rural Development Program.

Despite the development of other crops, Ms. Malanyaon said the provincial government is not abandoning coconut altogether as it is considered a “sentimental crop” by local farmers.

Coconut — in the form of crude or refined oil, desiccated, or copra oil cake — was the top agricultural export of the Philippines in 2014, with a freight on board value of $1.3 billion, which accounts for about 37% of the $3.6 billion total of the top 10 export products.– with a report from Marifi S. Jara

Brunei eyes LNG facilities in Mindanao

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September 19, 2012
By Amy R. Remo
Philippine Daily Inquirer

The energy ministry of Brunei Darussalam has expressed interest to put up liquefied natural gas (LNG) facilities in Mindanao, including the construction of a 300-megawatt gas-fired power plant to serve as an anchor load.

According to Energy Secretary Jose Rene D. Almendras, the Philippine government extended the invitation to Brunei to “have a serious look at the LNG prospects in Mindanao” during the 20th Asia Pacific Economic Cooperation (Apec) leaders’ summit in Vladivostok, Russia, earlier this month.

“They have expressed interest. They said they will come over and study it. The minister of energy of Brunei was very pleased with my invitation because they have also made a decision that they just don’t want to be a supplier of natural gas. [Brunei] also wants to integrate downstream initiatives,” Almendras explained. “I hope that we can interest them into becoming a natural gas power generator for Mindanao.”

Should the proposed investments push through, the LNG project in Mindanao would be a first for the island and the first foray of the Brunei government into LNG downstream investments outside its country.

The energy chief noted that the move to invite investors to look at prospective LNG projects in Mindanao was aligned with the Philippine government’s efforts to provide more sustainable solutions to the perennial power supply problems on the island.

A recent World Bank study on the feasibility of LNG projects in Mindanao has identified several potential locations, including Davao, General Santos, Iligan, Cagayan de Oro and the Phividec industrial complex in Misamis Oriental.

The study, according to the Department of Energy, looked into “parallel markets that will also use natural gas such as the industrial, commercial application as well as the transport sector to help pay for the costs of the proposed LNG terminal” since the power demand in Mindanao is not big enough to serve as anchor market for the LNG facility.