Senators warned against some violations in the sale of the 45-percent share of Chevron from the Malampaya natural gas project to Udenna Corporation of Davao-based businessman Dennis Uy.
In Tuesday’s hearing of the Senate energy committee on the Malampaya Deep Water Gas-to-Power project, the Department of Energy said Uddena bought at US$565 million on March 11, 2020, the 45-percent share of Chevron.
Committee chairman Win Gatchalian asked if energy officials were informed about the sale.
Energy Assistant Secretary Leonides Pulido said the sale was a done deal and they were told about it only on Oct. 28.
But Gatchalian said it was important for the DOE to scrutinize first Udenna’s technical capability before it was allowed to buy Chevron’s shares.
However, Pulido noted they did not see any violations.
The agreement provides the need to first secure the consent of all the members of the Malampaya consortium prior to the offer to buy the shares.
Pulido said the DOE needed to wait for that before evaluating the actual sale. He also said there would be no problem in the actual operation of Malampaya because Shell was the operator of the consortium.
Gatchalian said Malampaya was the single most important discovery of the country. He said the project powers 6.3 million homes, and is about 21 percent of the generation mix. He added that it powers up five power plants with a combined capacity of 3,211 megawatts and contributed P311 billion from the onset or an average of P17 billion to the national coffers annually.
Senator Imee Marcos quizzed Udenna if it had the capacity to operate Malampaya. Energy officials said they were evaluating this issue.
She also inquired into the background of Udenna in oil exploration and asked how the innovation and technical advancement of the oil industry would continue with Shell Philippines Exploration BV leading the joint venture with Udenna Corporation and the state-run Philippine National Oil Company-Exploration Corporation as partners.
On the other hand, Senator Panfilo Lacson questioned what would happen if the sale collapsed or Udenna did not pass the evaluation.
The senator also asked if PNOC was capable of taking over the Malampaya natural gas project in case the Udenna Corporation’s acquisition of Chevron’s 45 percent stake in the project would not push through.
“What will be the backup of DOE for Malampaya? Can the PNOC become the owner of the 45 percent of Malampaya?” Lacson said.
PNOC-EC president and chief executive Rozzano Briguez admitted that they currently did not have the technical and financial capability of taking over such big operation, but noted that it had been part of the corporation’s long-term plan.