Udenna gets hold of Malampaya stake

The Department of Energy has approved the divestment of Chevron Malampaya LLC’s (now UC38 LLC) 45-percent share in the Malampaya gas field project to UC Malampaya Pte. Ltd.

“Together with our partners, (we will) pursue extension of the production term in order to continue supplying gas and find then develop commercial volumes in the prospects within the existing service contract area,” Udenna Group spokesperson Raymond Zorrilla said in a message.

The contract will expire in 2024.

With this development, the focus will be on exploring oil and gas resources within Service Contract (SC) 38, which covers the Malampaya deep water gas-to-power project.

“We reiterate our company’s commitment to support the country’s energy agenda on security, self-reliance and use of cleaner energy sources, and the DoE’s approval of the transfer of rights is a welcome progress to reach this end,” Dennis Uy, Udenna chairman and chief executive officer, said in a statement on Wednesday.

“We are committed to the safe, reliable and sustainable development of the gas-to-power industry in the Philippines through Malampaya. UC38 continues to be led by the highly qualified team who were previously with Chevron and provides us with upstream technical, operational and commercial expertise based on global industry best practices,” he added.

To recall, in March last year, Udenna announced the acquisition of Chevron Malampaya’s stake in the natural gas project. A Senate hearing held last November revealed the deal was sealed to the tune of $565 million (P27.4 billion).

Other entities in the Malampaya gas facility are Shell Philippines Exploration B.V. (SPEX), the operator, with 45 percent. Meanwhile, state-run PNOC Exploration Corp. holds the remaining 10 percent.

It was in September last year when SPEX announced its plans to divest its holding in the $4.5-billion Malampaya facility.

Uy had divulged his company’s intention to fully take over the gas-to-power project along with PNOC EC.

Businessmen Ramon Ang made the same pronouncement earlier but recently disclosed they did not lodge a proposal to buy SPEX’s stake in the gas field project.

Tycoon Manuel Pangilinan, who also signified his interest in the Malampaya project, executed a non-binding offer to Shell through his firm First Pacific Company Ltd. and its partners.

The Malampaya deep water gas-to-power project in offshore Palawan fuels more than 30 percent of the Luzon grid’s energy requirements.