Gov’t consent to Razon’s Malampaya buy-in conditional
Enrique Razon, businessman and owner of casino operator Bloomberry Resorts, listens to a question during a stockholders meeting’ in Manila . REUTERS/Romeo Ranoco/File photo
The entry of ports tycoon Enrique Razon Jr. into the Malampaya deep water gas-to-power project is hinged on the commitment to harnessing resources in adjacent areas, a government official said.
In a virtual briefing, Energy Secretary Raphael Lotilla said the Department of Energy’s (DOE) approval of the sale of Shell Group’s stake in the Malampaya gas field to Razon’s Prime Infrastructure Capital Inc. (Prime Infra) “was premised also on the commitment of the new entrant to maximize the development of the existing resources in the Malampaya Camago reservoir with a view to developing the nearby fields as well.”
Prime Infra had acquired the 45 percent stake of Shell Philippines Exploration B.V. (SPEX) in Malampaya, which the DOE recently approved, subject to certain conditions.
These include SPEX remaining a subsidiary of Prime Infra alongside the continuing validity of Prime Infra’s commitments and undertakings with respect to SPEX’s obligations under the contract.
The DOE agreed that Prime Infra was technically, financially and legally qualified as the new Malampaya operator.
Prime Infra had said it would assume full control of SPEX once the transition process was completed by Nov. 1, 2022.Next on the agenda of the Malampaya consortium— composed of Prime Infra, UC38 LLC and PNOC Exploration Corp. (PNOC EC)—is the extension of the service contract that will expire in 2024.
Prior to this, PNOC EC, a unit of state-run Philippine National Oil Co., had given its consent to the deal.
The Malampaya gas field produces natural gas for power plants in Batangas that supply about 20 percent of Luzon’s total electricity requirements. —Jordeene B. Lagare INQ
