Dennis Uy secures gov't approval to buy out Chevron from Malampaya

Dennis Uy's UC Malampaya Philippines Pte. Ltd. has secured the go-ahead from the Philippine Competition Commission (PCC) to buy out Chevron Philippines Ltd. from the Malampaya Consortium, equivalent to a 45% stake in the gas field in offshore Palawan.

According to PCC Commissioner Johannes Bernabe, the transaction was approved by the PCC as it does not have a significant impact on competition.

"Wala namang horizontal overlaps kaming nakita because Udenna is not in the same business as Chevron," he explained.

In a decision dated January 22, the PCC said its Mergers and Acquisitions Office found that the transaction will not likely result in substantial lessening of competition.

"This is because there are no horizontal or vertical relationships between the parties," the decision read.

The deal between the two parties was announced by Udenna Corp., UC Malampaya's parent company, in October upon the signing of the sale and purchase agreement.

Chevron Malampaya LLC has a 45% participating contractual interest in Service Contract 38, or the Malampaya gas-to-power business in offshore Palawan.

The Malampaya gas-to-power facility fuels three gas-fired power plants with a total generating capacity of 2,700 megawatts (MW), providing up to 30% of the power generation needs of Luzon.

Connected to onshore gas plants in Batangas, the Malampaya offshore facility in northern Palawan was inaugurated in 2001.

Aside from Chevron, the Malampaya consortium counts as members Shell Philippines Exploration BV (SPEx), and the Philippine National Oil Company – Exploration Corp. as members.

Meanwhile, Udenna Corp. is the holding company of the Udenna Group of Companies which counts as subsidiaries Udenna Management and Resources Corporation, Phoenix Petroleum Holdings Inc., Chelsea Logistics and Infrastructure Holdings Corporation, PH Resorts Group Holdings Inc., Udenna Land Inc., Udenna Infrastructure Corporation, and Le Penseur, Inc.

Shell earlier this month said it will remain the operator of the Malampaya gas field even with Udenna Corp's buy out of all the shares of Chevron.

"The contract naman kasi is kami pa rin ang operator," Shell communications manager Cesar Abaricia said. — MDM, GMA News