Razon firm moves closer to acquiring

MANILA, Philippines — Malampaya stake The infrastructure arm of tycoon Enrique Razon has moved forward with its plans to acquire ownership in the Malampaya deep-water gas-to-power project.

In a statement, Prime Infrastructure Capital Inc. said that its subsidiary Prime Exploration Pte. Ltd. has signed a share purchase agreement to acquire MEXP Holding Pte. Ltd. (MEXP) from Udenna Corp. of Davao businessman Dennis Uy.

MEXP previously signed an agreement with Shell Petroleum NV, acquiring Shell Philippines Exploration BV (SPEX) from the latter.

SPEX owns a 45-percent participating interest in the Malampaya deep-water gas-to-power project and is the operator of the project’s consortium.

The other members of the consortium are Udenna subsidiary UC38 LLC and the PNOC Exploration Corp. (PNOC EC), which hold 45-percent and 10-percent participating interest in the project, respectively.

Prime Infra said the change in control of SPEX from Shell to Prime Infra is subject to the consent of PNOC EC and the Department of Energy.

“Once such consents are given and the transition process for a safe and seamless handover of operations is completed, Prime Infra will assume full ownership and control of SPEX,” it said.

Prime Infra said it is working  with Shell and Udenna to achieve a smooth transition of SPEX to Prime Infra.

“We look forward to this opportunity to partner with Prime Infrastructure and PNOC EC, as we explore more ways to fulfill our common vision to make Malampaya continue to operate safely and reliably to strongly support our country’s need for indigenous and sustainable energy for many years to come,” said Uy, chairman and CEO of Udenna.

One of the country’s most important power assets, Malampaya produces natural gas to power plants in Batangas City that account for around 20 percent of the country’s total electricity requirements.

It began operations in 2001, with the consortium’s license for the project set to expire in 2024.

Prime Infra chairman Enrique Razon said its acquisition of MEXP reflects the company’s shared commitment with the national government to help maintain energy security and independence in the transition to a renewable energy-fueled Philippine economy.

“We believe that gas is an important transition fuel in the near-term, reducing the need for baseload fossil fuels like coal. Hence, we intend to accelerate investments on the Malampaya gas field to improve the output of existing wells and, if possible, develop new wells in the area once the license extension is secured from the government,” Razon said.