MVP, Dennis Uy may revive oil, gas project

MANILA, Philippines — Tycoon Manuel V. Pangilinan and Davao-based businessman Dennis Uy may revive their previously cancelled partnership for oil and gas exploration and LNG development if the opportunity arises.

Last March, Pangilinan-led PXP Energy Corp. and Uy’s Dennison Holdings Corp. shocked the market when they announced that they have cancelled a potential team up in the country’s liquefied natural gas (LNG) sector.

The scrapping of the deal comes less than a year after it was first announced in October 2018.

“We both agreed not to pursue it because of uncertainties of the contracts. There was no progress, but we agreed to revisit once there is an opportunity again,” Uy told reporters last week.

Pangilinan’s PXP Energy owns oil and gas exploration and production assets located in the Philippines including those in the disputed West Philippine Sea, and indirectly owns an exploration asset located in offshore Peru. However, some of the exploration contracts such as those in the disputed areas have had no progress.

Uy and Pangilinan’s partnership could have translated to a potential LNG project as it would enable Pangilinan-led PXP Energy to acquire a stake in Phoenix Petroleum’s joint venture with China National Offshore Oil Corp. (CNOOC) for LNG development.

Last October, the two groups announced a subscription agreement that covers the subscription of Uy’s Dennison Holdings to PXP Energy’s 340 million common shares at P11.85 a piece totalling P4.03 billion.

In exchange for the shares, PXP Energy or any of its affiliate companies would be given preferential rights to acquire up to 49 percent in Uy’s Phoenix Petroleum’s share in its joint venture with CNOOC for LNG development.

However, the two parties announced the cancellation of the deal last March or two days before the March 31 deadline to settle the entire subscription price.

With the cancellation, the downpayment paid by Dennison has been forfeited in favor of PXP Energy.

So far, Dennison paid one percent of the total subscription price amounting to P40.29 million last January.

Uy said the decision was mutual, but it is not necessarily the end of a partnership with Pangilinan. He said it may still happen in the future.

“MVP (Manuel V. Pangilinan) said they would invite us again if there is progress,” Uy said.

Pangilinan-led PXP is an upstream oil and gas company. It is listed on the Philippine Stock Exchange. It directly and indirectly owns oil and gas exploration and production assets located in the Philippines, and indirectly owns an exploration asset located in offshore Peru.

Dennison and Phoenix Petroleum, meanwhile, are led by Uy.

While it scrapped the deal with PXP Energy, Phoenix Petroleum, together with CNOOC Gas and Power Group Co. Ltd. signed a memorandum of understanding with state-run Philippine National Oil Co. (PNOC) to explore and discuss business opportunities and cooperation in relation to the equity investment in Tanglawan Philippine LNG Inc.