Prime Infra to take control of Malampaya gas-to-power project

Prime Infra Holdings has agreed to purchase a controlling stake in the Malampaya gas-to-power facility in the Philippines from Udenna Corp, Reuters reported June 2.

Udenna holds a 90% stake in the project, but Prime Infra did not confirm how much it was buying. State-owned Philippine National Oil Co Exploration owns the remaining 10% stake in Malampaya.

The transaction is subject to approval by the Philippine Department of Energy as well as PNOC-EC. Neither agency responded to Reuters' request for comment.

Udenna is managed by Philippine magnate Dennis Uy, who is thought to be close to the outgoing president of the Philippines, Rodrigo Duterte. It acquired Chevron's 45% stake in the offshore Malampaya gas field, situated in the South China Sea, in the Philippines' Reed Bank, in March 2020.

Malampaya supplies fuel to meet around 40% of gas-fired electricity needs in the Philippines' Luzon region. The field has entered decline and reserves could run out as soon as 2027 under current projects, according to DOE estimates cited by the Manilla Bulletin. Alfonso Cusi, energy secretary of the Philippines, on October 21 told the Manilla Bulletin that Malampaya's current production sharing contract would lapse in 2024. 

Prime Infra Holdings is controlled by ports and gaming tycoon Enirque Razon, the Philippines' second richest man. The deal buys Razon access to more Reed Bank resources, extending Prime Infra's existing participation in an oil exploration concession, Reuters said.