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Thursday, March 28, 2024

PNOC-EC purchasing 4.5% Malampaya stake for $56m

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State-run PNOC Exploration Corp. said it will acquire an additional 4.5-percent stake in the Malampaya natural gas project for around $56 million as a part of its right of first refusal on the sale of Chevron Malampaya LLC’s 45-percent stake to Udenna Corp.

“PNOC EC exercised its right. We are getting that…We exercised the right because we feel that the acquisition price is advantageous… It’s advantageous for [PNOC] EC to invest. It’s an opportunity for EC to invest [as] the returns are good,” Energy Secretary and PNOC-EC chairman Alfonso Cusi told reporters.

Udenna, controlled by businessman Dennis Uy, earlier signed an agreement  to acquire the entire shareholdings of Chevron Malampaya LLC, a wholly-owned subsidiary of Chevron Philippines Ltd. in October.  Chevron held 45-percent stake in the Malampaya gas project.

As a member of the Malampaya consortium, PNOC Exploration, which has 10-percent stake in the project, has the right to match the offer of Udenna for 10-percent of Chevron’s stake.

Cusi said this meant that PNOC-EC would acquire another 4.5-percent stake in the project which was proportionate to 10 percent of the Chevron-Udenna transaction.

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“It’s 10 percent of the share of Chevron.  As of now we have 10 percent. The one they are selling is 45 percent. We are also getting 10 percent of the 45 percent, because is Shell is not selling,” Cusi said.

Shell Philippines Exploration B.V., which owns a 45-percent stake and serves as the operator of the $4.5-billion project in northwest Palawan, did not exercise its right to match the offer of Chevron, Energy Undersecretary Donato Marcos said.

Cusi said the PNOC-EC board would meet on Friday to discuss the acquisition price.

“Yes, the board approved it already so PNOC EC is exercising its right. Question is how much 10 percent of whatever value. How much did Udenna acquire [Chevron’s stake]? If I remember it right, it’s around $560 million. Whatever that amount is, PNOC EC has the right to match that 10 percent,” the energy chief said.

UC Malampaya Philippines Pte. Ltd., a wholly-owned subsidiary of Udenna,  signed an agreement on Oct. 25 to acquire 100 percent of the shares of Chevron Malampaya which has a 45-percent stake in the Malampaya project.

“At Udenna, we believe in the benefit of promoting natural gas as an essential fuel to support the country’s growing energy needs and economic growth. The acquisition of Chevron’s interest in the Malampaya gas field marks an important milestone for Udenna, fitting strategically with our long-term ambitions of developing a sustainable clean energy business in the Philippines,” Uy, Udenna chief executive officer and chairman, said earlier.

Udenna said the signing of the SPA marked an important milestone in the bilateral discussions between Chevron and Udenna over the past 12 months, and demonstrated their lose collaboration in achieving a positive outcome for all parties involved.

“We look forward to working with the joint venture partners, Shell and PNOC, and Malampaya’s key stakeholders, including the Philippines Department of Energy, to ensure that Malampaya continues to play an important role in sustainable nation building in the Philippines,” the company said.

The Malampaya gas field is an energy asset of significant national importance, being the Philippines’ largest and only commercially-producing gas field.

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