Senators have raised eyebrows over Chevron’s sale of its 45% stake in the Malampaya gas-to-power project to Udenna Corporation of Davao-based magnate Dennis Uy.
Sen. Sherwin Gatchalian, chairman of the Senate Committee on Energy, noted at its hearing on Tuesday that the transaction had no prior approval by the Department of Energy (DOE). Gatchalian earlier pointed out that Udenna must prove its technical capability to run the project.
Udenna completed the US$565 million (Php27.4 billion) purchase from Chevron last March 11.
Energy Asec. Leonido Pulido III explained that it sees no violation in the sale, adding that there was no issue involving the gas platforms actual operations since Shell Philippines Exploration B.V. (SPEX) is the one in charge. SPEX, however, is selling its 45% stake.
Chevron Malampaya officials added that the purchase was a commercial transaction and is not covered by Section 11 of Presidential Decree No. 87 or the Oil Exploration and Development Act of 1972.
Under the provision, the transfer of rights and obligations under a contract executed under PD 87 have to be approved by the Petroleum Board — the predecessor of the DOE.
Pulido added that the DOE is currently assessing Udenna’s capability since it is a relatively new player in the energy sector, adding that the contract between the two parties can be voided if it disapproves the sale.
Sen. Panfilo Lacson then asked officials of the Philippine National Oil Company (PNOC) if they can take over Malampaya. PNOC President Reuben Lista said that it wasn’t ready technically and financially to take over the facility.
