Cusi mulls buy-back of Malampaya, PNOC-EC to corner equity in Shell stake
By Myrna M. Velasco – March 17, 2022, 3:04 PM
from Manila Bulletin
The government, through the Philippine National Oil Co.-Exploration Corp. (PNOC-EC), is exploring the possibility of a buy-back of the Chevron shares and to also acquire equity in the 45-percent shareholdings of Shell Philippines Exploration B.V. (SPEX) in the Malampaya gas field venture once the divestment would already be given final go-signal, Energy Secretary Alfonso G. Cusi said.
“There is a possibility that we might be able to get a certain percentage of shares, through PNOC-EC, and that’s currently undergoing discussion,” the energy chief noted during an open forum at the 35th weekly membership meeting of the Rotary Club of Manila.
Cusi similarly qualified that in the sale of Shell’s 45-percent stake, PNOC-EC already “waived its right to match,” and at this point, the state-run company has still not given its consent to the sale.
Relative to that decision, Cusi emphasized that “we are still under negotiation” – and he was referring to the ongoing discussion between PNOC-EC where he is Chairman of the Board; and that of Shell, the asset-seller and current operator of the Malampaya gas field.
The Rotary Club of Manila, similarly proposed that if the government would want to buy-back the 45-percent Malampaya shares of Chevron that was sold to Davao businessman Dennis Uy in 2020 to help solve the financial quandary of the government, the organization would be able to help package the new transaction, including tapping new lenders.
“Our proposal, and we say this with keen expertise coming from our battery of investment bankers and finance experts, our proposal is to help you – if and when the PNOC decides through its Board which you chair – to possibly buy-back the 45-percent ownership of Chevron, and later on of Shell in the Malampaya gas project from Mr. Dennis Uy,” said Joel Valdes, Rotary Club member and a renowned finance executive.
Valdes stressed that since the sale of the Chevron stake in Malampaya in March 2020, the asset’s value had already risen by roughly 30 percent to 40 percent given the soaring prices of fuel in the world market.
“So, if we actually just buy him (Uy) out, we can help you change the creditors because there’s enough liquidity in the economy right now,” he pointed out.
Cusi responded that he will wait for the proposal of the Rotary Club on the targeted buy-back of Uy’s current shareholdings in the Malampaya venture.
It was in March 2020 when the Davao businessman had completed his acquisition of the 45-percent shareholdings of American firm Chevron Corp. in the Malampaya gas field for a transaction worth $565 million.
Subsequently, Shell announced its stake divestment in the gas field in May last year to Malampaya XP Energy Pte. Ltd., another company of Uy, for $460 million — and that deal was originally targeted for transaction closing last December – but the process stalled after PNOC-EC declared that it was withholding its consent on the sale process.
