MVP keeping an eye on Malampaya

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The MVP Group of Companies is keeping a close eye on the Malampaya gas field following the recent developments surrounding the controversial transactions of Udenna Corporation.

In a report by The Philippine Star, MVP Group Chairman Manny V. Pangilinan said that the group is waiting to see how the issues on the sales of Malampaya would be resolved. He did not say, however, if it was still interested in purchasing part of the asset.

Aware that Malampaya’s reserves are depleting, Pangilinan noted that it would be good to develop fuel from indigenous sources.

Pangilinan first expressed his intention to buy Shell Philippines Exploration B.V.’s (SPEX) 45% stake in Malampaya when it announced the sale in September 2020. The MVP Group, then, made the formal offer early last year.

The business tycoon later said that once Service Contract (SC) 72 develops into an oil field, they would connect it to Malampaya to process the raw gas before transporting it to the country’s five gas-fired power plants in Batangas City. Pangilinan-led PXP Energy owns the rights to the SC72 exploration block further out in the West Philippine Sea.

Udenna, which already owned the other 45%, eventually edged out the MVP Group, as it bought SPEX in May last year. However, PNOC-Exploration Corporation, which owns the remaining ten percent, blocked the deal before it could secure approval from the Department of Energy (DOE). 

Sen. Sherwin Gatchalian, chairman of the Senate Committee on Energy, said in the latest episode of Power Podcast that a sale of an interest in an exploration venture like Malampaya’s SC38 should have the consent of its other owners. Presidential Decree (PD) 87 or the Oil Exploration and Development Act of 1972 also states that such transactions must have government approval.

Gatchalian last week called for the resignation of Energy Sec. Alfonso Cusi and ten other DOE officials particularly over the Chevron-Udenna deal. The Senate also recommended the filing of charges against Cusi, the ten officials, and former Energy Asec. Leonido Pulido III. Cusi refused to step down, even getting support from Pres. Rodrigo Duterte.

The senator also recommended amendments to PD 87.

Photo from First Pacific Leadership Academy website.