Gov’t okays sale of part of PNOC unit’s 10% stake in Malampaya

The government’s Privatization Council has approved the sale of 49 percent of PNOC Exploration Corp.’s (PNOC-EC) 10-percent stake in the $4.5-billion Malampaya offshore natural gas project.

This was disclosed by PNOC-EC, a unit of state-owned Philippine National Oil Co. to securities regulators last Friday.

PNOC-EC said interested investors can either directly bid for the 49 percent of the firm’s 10-percent interest in the Malampaya project, which is covered by Service Contract (SC) No. 38 or make an offer for 49 percent of the outstanding shares of PNOC Malampaya Production Corp. (PNOC-MPC).

PNOC-MPC is a company wholly-owned by PNOC-EC and to which SC 38 assets and related debt will be transferred.

Interested parties have until Feb. 25 to submit their respective bids. Those intending to bid for a direct sale are required to submit a mandatory binding bid for sale in corporate form, PNOC-EC said.

The privatization is in compliance with the condition imposed by the government for providing a sovereign guarantee for the credit facility obtained by PNOC to finance the acquisition by PNOC-EC of its 10-percent participating interest in the Malampaya project.

The Malampaya natural gas fields are being operated by a consortium that also includes the Royal Dutch/Shell group and US oil major Chevron/Texaco. Malampaya, located in the South China Sea off the island of Palawan, is the largest single project in the Philippines.

The deep-water site began supplying natural gas to power plants in the main Philippine island of Luzon last year.

PNOC-EC is primarily engaged in the exploration and development of oil, gas and other energy resources. It can also purchase, operate and maintain all kinds of plants, warehouses, terminals, docks, piers, wharves and other water works facilities.