Energy Secretary Raphael Lotilla is leaving the Philippine National Oil Company-Exploration Corp. (PNOC-EC) to resolve the issues regarding the sale of the Malampaya stake between Shell Philippines Exploration B.V (SPEX) and Udenna Corporation.
It can be recalled that PNOC-EC withheld its consent of the 45% SPEX interest to Udenna unit Malampaya Energy XP (MEXP). Last month, Prime Exploration Pte. Ltd, a subsidiary of Prime Infrastructure Capital Inc., signed a share purchase agreement acquiring MEXP.
Lotilla said that while he is also the chairman of PNOC-EC, he would let the state-owned company’s newly appointed president and CEO Franz Josef George Alvarez, and the board lead the review as the DOE would be evaluating and approving the agreement met by the involved parties.
The energy secretary added that Alvarez would need to address the issues with the Malampaya with the PNOC-EC board soon because certain timelines that have to be met. For one, Malampaya’s Service Contract (SC) 38 is expiring on 2024.
PNOC-EC owns a 10% stake in the Malampaya and under the joint operating agreement (JOA) of SC38, the consent of all project shareholders should be secured before partners in the consortium can divest their interest in the project.
SPEX is the operator of Malampaya with a 45% stake. Another Udenna subsidiary, UC38 owns the 45% stake after the DOE approved the sale from Chevron.
The Malampaya is seen to be completely depleted by the first quarter of 2027. It currently accounts for 20% of the country’s total power requirement.