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Sunday, May 19, 2024

No hurdle to Razon’s takeover of Malampaya project—Pimentel

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A senior member of Congress said there was no hurdle to the takeover of the Malampaya deepwater gas-to-power project by ports and gaming tycoon Enrique Razon Jr. from Dennis Uy’s Udenna Corp.

“We in Congress have always maintained that private parties are free to get in and get out of existing petroleum service contracts,” said Surigao del Sur Rep. Johnny Pimentel, chairperson of the House strategic intelligence committee, in a statement on Sunday.

“These transfers of operating and/or participating interests in petroleum service contracts are private commercial transactions involving the sale of investments between corporations,” he added.

In these transactions, Pimentel said, the role of the Department of Energy is merely to oversee the orderly handover of operations with a view to ensuring project continuity and development.

Pimentel acknowledged that Razon would be in a strong position to take advantage of Malampaya’s existing infrastructure as the springboard for the development of a potential integrated gas hub.

Malampaya’s 504-kilometer undersea pipeline delivers gas to power plants in Batangas that in turn supply 20 percent of the country’s demand for electricity.

Razon, through publicly listed Apex Mining Co., also has a 30 percent participating interest in the other petroleum service contract that contains the Sampaguita gas discovery located 250 kilometers southwest of Malampaya.

Pimentel said he would not be surprised if Razon also ends up acquiring a majority stake in Sampaguita.

Dubbed as the next Malampaya, Sampaguita is estimated to contain anywhere from 3.5 trillion to 4.6 trillion cubic feet of gas.

The estimate is comparable to, if not bigger, than Malampaya’s 3.4 trillion cubic feet when it was first discovered in 1989.

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