The Philippines’ President Gloria Arroyo has signed Executive Order 839.   This Executive Order mean for prices of oil in areas ravaged by typhoon in the Philippines to be fixed.

In so doing, the astute politician in Arroyo trumped her PhD in Economics.  Naturally, business groups in the Philippines want fuel price freeze lifted.

The price and supply of oil is hotly debated the world over.  Just look at this chart which you can find from oil analyst gregor.us:

Free Market Oil has dropped by over 2 million barrels per day since December of 2003. If your professor or your local economist or perhaps national newspaper is still pounding the table that supply always makes a response to price–even in natural resources. -gregor

Just so we’re on the same page, December delivery of oil, as of this writing is at US$77.43 a barrel.

Philippine journalist Ricky Carandang wrote in his blog that Arroyo repealed the law of supply and demand and argued that:

the Arroyo regime continues to force pump prices at levels below the market price, it will eventually lead to a shortage.  And that’s what we’re begining to see. Gas stations may not call it that, but they are already rationing fuel and are now threatening to stop importing altogether.

How then can one do business in the Philippines when the law says the Oil Industry is a deregulated market and government itself does another?

Oil companies are under threat to be sued under economic sabotage.  If there is anyone that needs to get sued, under economic sabotage it is Gloria Arroyo and this economic self destructive policy.

What if Executive Order 839 isn’t about the price of oil or its supply?

EO 839 is a populist move.   It is easy enough to see that this is done under the guise of compassion, “to protect the poor” and victims of the recent typhoons from market forces.   It is a false oasis.  This road leads only to greater hardship down the road.  It appeals to shortsightedness and reveal greater uncertainty in the market place.  In fact, EO 839 only strengthens the perception that the Philippines is unstable and that the law is bendable at any given time.    If the Philippines was at all serious about solving its energy problem, then it should accelerate plans to be less oil dependent.  That is what a responsible economic manager ought to be pursuing.

What if this has little to do with the Price of Oil or about rebuilding the damage of the recent typhoons?  What if this has nothing to do with improving the lives of Filipinos ravaged by typhoon and poverty?  With Arroyo, by law, set to complete her term of office by June 2010, and her party’s candidate trailing surveys, is it a stretch to say that this is a scorch earth strategy to make it difficult for the next president to do anything at all?

SeaEnergy PLC & Taiwan Generations Corporation(TGC) have concluded a Heads of Terms Agreement under which they will undertake the joint development of TGC’s pipeline of offshore windfarm projects.

Under the terms of the Agreement, signed by TGC and SeaEnergy, the companies will work on a variety of projects, commencing with the Changhua Offshore Windfarm (the “Project”), which it is planned will have an installed capacity of up to 600MW. Combining SeaEnergy Renewables’ offshore development expertise with TGC’s pipeline of projects, local knowledge and experience, the partners will jointly plan, construct and operate offshore windfarms in Taiwan.

The Changhua Offshore Windfarm will be located in the Taiwan Strait off Changhua county on the west coast of Taiwan, about 2.5 to 10 km from shore in water depths up to 30m. The windfarm will initially be jointly owned by TGC and SERL, and may in the future, include other strategic investors as the development progresses. The Agreement provides SeaEnergy with the right to retain a 25% working interest in the windfarm developments.

The Project is expected to require modest initial investment, by both companies, to complete studies, already commenced, which are required to gain a franchise – which equates to regulatory consent – from the Taiwanese Government.

The Taiwanese Government has set a target of 15%, or 8,450MW, of Taiwan’s electricity to be generated from renewable resources by 2025. The offshore wind potential has been recognised by the Taiwan Government as offering the fastest gateway to attain such a goal. Taiwan Government foresees a potential of at least 3,000MW of offshore wind power.

Joel Staadecker, CEO of SeaEnergy Renewables Limited said:

“We are very much looking forward to working with TGC to develop The Changhua Offshore Windfarm and to begin fulfilling Taiwan’s offshore wind potential. Taiwan represents an opportunity for SeaEnergy to internationalise quickly in an environment where a project can be consented at a reasonably early date and at reasonable cost.”

“This project is the perfect way for us to take our unique expertise overseas and to explore new and exciting opportunities at relatively low risk. The project is planned to track our development model which includes ultimately partnering with major utilities and power generators.”