Senate energy committee to release findings on Malampaya deals


(UPDATED) Sen. Sherwin Gatchalian’s privilege speech on the controversial sale of the Malampaya gas-to-power project to Dennis Uy’s Udenna Corporation was moved to Wednedsay, the lawmaker’s office said.

Gatchalian, chairman of the Senate Committee on Energy, said in the latest episode of Power Podcast on Monday afternoon that the committee has concluded its probe into the sale of Chevron’s 45% to Udenna and Shell Philippines Exploration B.V.’s (SPEX) 45% last May

Meron na kaming findings based on the four hearings we conducted [and] based on the documents we saw,” Gatchalian said. “Ipapaalam natin sa mga senador and the Senate would decide on how to pursue it.” 

Back in December, PNOC-Exploration Corporation (PNOC-EC) withheld its consent for SPEX to sell its stake. PNOC-EC owns ten percent of Malampaya.

The controversial sale caused an uproar not only in the Senate but also in online communities, which according to Gatchalian, has put pressure on PNOC-EC to withhold its consent to sell SPEX’s portion of the project. 

Gatchalian noted that under Presidential Decree 87 or the Oil Exploration and Development Act of 1972, two conditions must be satisfied before the sale of a joint exploration venture could take effect. First, all parties must give their consent, and second, the Department of Energy (DOE) must approve the transaction upon a review of the buyer’s financial and technical capability to run such a facility.

The Chevron-Udenna deal took place in March 2020 and the DOE approved it in April 2021. However, Gatchalian had said the deal was “defective and invalid.” He also described the transaction as “lutong Macau.”

Had PNOC-EC given its consent to the sale of SPEX’s interest, Udenna would have 90% control of Malampaya – the country’s major source of indigenous natural gas.

Gatchalian said that PNOC-EC gave its consent to the Chevron-Udenna deal, but reiterated that the sale itself had no government approval. 

“Lumalabas nga na ‘yung kanilang pag-apruba ay walang legal basis. Inamin ng kanilang tauhan, si Atty. [Cesar] De La Fuente, at nung tinanong namin si Sec. [Alfonso] Cusi, hindi nya masagot kung ano [ang] legal basis,” Gatchalian said, recalling the hearings regarding the controversial sale. 

De La Fuente is the Director of the DOE’s Energy Resource Development Bureau.

While the DOE approved Udenna’s purchase of Chevron’s Malampaya share last year, it admitted to using an unaudited financial statement from Udenna to approve the acquisition.

Davao-based Uy was a major financier of then-Mayor Rodrigo Duterte’s presidential run in 2016. 

Cusi and Uy are facing graft charges before the Office of the Ombudsman over the controversial deals. Both, meanwhile, have filed libel charges against several media entities over the reportage of the graft cases.

Catch the full episode of Power Podcast with Sen. Sherwin Gatchalian on YouTubeSpotifyApple PodcastsGoogle Podcasts, and Amazon Music.