Shell Philippines Exploration B.V. (SPEX), the operator of the Malampaya gas-to-power project, said it is willing to divest its 45 percent stakes in the country’s sole source of natural gas fuel as part of its parent firm’s rationalization activities.
“As part of an ongoing portfolio rationalization to simplify and increase the resilience of its business, Shell is exploring its options with a view to divest its interest in Service Contract 38 (Malampaya). Shell would ensure a smooth transition of the asset to a credible buyer who would be well placed to optimize the value from Malampaya,” Don Paulino, SPEX’ managing director and general manager, said in a statement.
However, Paulino assured the company will still be operating in the Philippines as it “remains an important country for Shell after over a century of successful operations” and will continue “to pursue opportunities where it can leverage its global expertise in line with its strategy.”
Early this year, Udenna Corp. completed the acquisition of Chevron’s 45 percent stake in the Malampaya resource.
Last year, state-run firm, PNOC-Exploration Corp. (PNOC-EC) also expressed its interest to exercise its right to match to buy 10 percent of the 45 percent stake that was acquired by Udenna Corp. but is yet to materialize.
At present, both SPEX and Udenna has 45 percent stakes in the resource and the remaining 10 percent is being held by PNOC-EC.
If PNOC-EC’s plans will proceed, it will have a 14.5 percent stake as Udenna will have a 40.5 percent and SPEX with 45 percent.
The contract of operating the Malampaya gas field is set to expire by 2024 but its resources are expected to be depleted by 2027 to 2029 which supplies fuel to several power plants with a combined capacity of more than 3,000 megawatts.