PNOC Exploration Corp. (PNOC-EC) continues to be in discussion with executives of Shell Petroleum N.V., an official of the state-led company said on Tuesday, amid talk that other entities are keen on the foreign group’s stake in the offshore Malampaya gas-to-power project.

“The PNOC-EC and Shell Petroleum N.V. bosses are talking about the decision that was made last December, and PNOC-EC is not in talks with anybody else, but Shell,” said Joseph W. Buduan, who leads the oil and gas exploration firm’s media relations office.

He was responding to a request for confirmation after an executive from the Shell group said that Shell Petroleum’s door is closed to any offer from other companies as it is still in talks with PNOC-EC to gain the latter’s consent to the sale of Shell Philippines Exploration B.V.’s (SPEx) 45% stake in the project to a subsidiary of Udenna Corp.

Mr. Buduan did not elaborate on details of the discussion between the two parties. PNOC-EC holds a 10% stake in the Malampaya project.

In an earlier text message on Tuesday, a SPEx executive who asked not to be named said: “Shell is still focused on the sale transaction with Malampaya Energy XP Pte. Ltd. as the transaction signed in May 2021 is still active.”

“Since the sale transaction to MEXP (Malampaya Energy XP) is still active, Shell will continue the dialogues with PNOC-EC,” the executive added.

Shell Petroleum is the signatory to the sale and purchase agreement with Udenna’s Malampaya Energy XP for the operating interest of SPEx in Service Contract (SC) 38, which covers the Malampaya gas field.

Shell Petroleum previously said the base consideration for the sale is $380 million, with additional payments of up to $80 million between 2022 and 2024 “contingent on asset performance and commodity prices.”

The deal came after Udenna unit UC Malampaya Philippines Pte. Ltd. signed on Oct. 25, 2019 a sale and purchase agreement to acquire the entire stake of Chevron Malampaya LLC, which holds 45% of the deep-water project.

On Dec. 16, the top official of PNOC-EC, the exploration company of state-led energy company Philippine National Oil Co. (PNOC), announced that he had withheld consent to the SPEx sale to Malampaya Energy XP.

Rozzano D. Briguez, PNOC-EC president and chief executive, made the disclosure during a Senate hearing, but did not elaborate on the reason for the withheld consent.

Manuel V. Pangilinan, chairman and president of Metro Pacific Investments Corp.,  said during a media round table discussion on Feb. 3 that he was waiting to see how the Malampaya stake sale would unfold, noting that it would be good to develop the natural gas field.

He did not confirm if his company was still interested in buying SPEx’s interest in the Malampaya consortium.

Malampaya is the country’s lone natural gas field that provides 20% of the country’s energy requirements. — Marielle C. Lucenio

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