Shell completes sale of its interest in Malampaya gas field
Shell Petroleum N.V. has completed the sale of its 100% shareholding in Shell Philippines Exploration B.V (SPEX) to Malampaya Energy XP Pte Ltd (MEXP), a subsidiary of Prime Infrastructure Capital Inc., following consent from the joint venture partners and regulatory approval.
Shell Petroleum signed the agreement to sell its interest in Malampaya, Philippines in May 2021 to Udenna Corporation, a holding company founded by businessman Dennis Uy who was closely associated with former Philippine President Rodrigo Duterte.
In November 2019, Udenna Corporation announced that its wholly owned subsidiary, UC Malampaya Philippines Pte Ltd., had signed a sales and purchase agreement with Chevron Philippines Ltd. for 100% shares in Chevron Malampaya LLC, which held a 45%, non-operating stake in the Malampaya gas-to-power project.
In September 2020, Shell announced its intention to divest Shell Philippines Exploration BV, which held the 45% operator stake in Malampaya. Udenna promptly expressed interest in assuming operator status at Malampaya. However, the transaction became controversial, with the filing of a criminal complaint against then Philippine Energy Secretary Alfonso Cusi, Uy, and several others over Udenna’s acquisition of the Chevron stake.
In a 42-page complaint, the complainants alleged that Cusi and other energy officials “conspired to give unwarranted benefits and advantage to Uy’s Udenna Corporation and its subsidiary, UC Malampaya” for the buyout, which was called a “midnight deal” by the energy committee of the Philippine Senate. Subsequent Senate hearings revealed that the Udenna-Chevron agreement had been signed about two weeks prior to being made public.
Shell’s sale of its 45% share of the Malampaya gas project to Udenna Corporation for USD460 million stalled after the country’s national oil company Philippine National Oil Co. (PNOC) blocked the deal amid crumbling political support.
That’s when Prime Infrastructure Capital, Inc., Filipino businessman Enrique K. Razon Jr.’s infrastructure firm, stepped in to acquire a controlling interest in Malampaya. The transaction required consent from the Philippine Department of Energy and Philippine National Oil Co. (PNOC) – Exploration Corp., which holds a 10% interest in the Malampaya gas field.