Gatchalian expresses “strong personal doubts” on Udenna’s takeover of Malampaya

Senate energy committee chairman Sherwin Gatchalian on Tuesday expressed strong personal doubts on Udenna Corporation’s takeover of the Malampaya gas-to-power project in Palawan.

“Personally, I made a statement that I have strong doubts but we will let the process go through,” Gatchalian said in an ANC interview when asked if he thinks that Udenna is qualified to take over the Malampaya operations.

He said it is up to the Department of Energy (DOE) to assess whether the corporation is qualified to operate Malampaya but it has to disclose the set of criteria that it followed in evaluating the firm’s capability.

“It was not very clear to us the criteria they (DOE) used in terms of evaluating this and it has to be very clear to the public what are the criteria, number one, and number two, the new company is competent based on that list,” he added.

The Senate energy panel will call on the DOE to disclose the details on the sale of Shell Philippines Exploration B.V. (SPEX) stakes to the Udenna Corp.

“The DOE has set of the processes and we will allow the DOE to commence with the process, but justified to the public, us, being the consumers, we want to be assured that the new owner is highly qualified,” he said.

Gatchalian refused to give a comment when asked if he believes that the DOE has given preferential treatment to Udenna Corporation, which is owned by businessman Dennis Uy-- a known friend of President Rodrigo Duterte.

On Tuesday, Energy Secretary Alfonso Cusi said the agreement between the Udenna Corporation and the SPEX on the acquisition of 45% participating interest in Petroleum Service Contract No. 38 (SC38) is a private transaction in which the DOE has no participation.

“The Department of Energy (DOE) did not take part in the decision of SPEX to sell, the bidding or negotiations that ensued, and its outcome,” he said in a statement.

He, however, assured the public that the DOE will review and approve the transaction once it is finished at the consortium level.

Gatchalian earlier issued a statement, urging the DOE to divulge its plans and programs on Malampaya in light of the divestment of Shell and the nearing expiration of the Malampaya deep water gas-to-power project to ensure the future of its operations and the continuous supply of energy in the country.

“It is critical for the DOE to ensure that whoever gets hold of Shell’s interest should have, not just similar experience or capacity, but more so the technical, financial and legal capability to operate the Malampaya project or to be a service contractor,” Gatchalian said.

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.

The project has provided a crucial source of income for the government with a total net national government share amounting to 261,681,610,752.59 since it began commercial operations in 2002 until 2019, according to Gatchalian.—AOL, GMA News