Udenna Corporation of Davao City magnate Dennis A. Uy has decried the alleged political motives of those who are trying to discredit its acquisition of the controlling stake in the $4.5-billion Malampaya gas-to-power facility.
Udenna president Raymundo Martin Escalona said the “misunderstanding from certain sectors of the business community” has resulted in misinformed claims that the government will lose billions of pesos due to its Malampaya deal.
Escalona issued the statement during a virtual press conference Thursday, in which he said the intended target of Udenna’s detractors is the government itself, except “there’s not enough for them to attack this administration.”
“They try to attack anyone who is perceived to be close to this administration,” Escalona said. “I think it’s unfair because we’re collateral damage and they don’t realize there are livelihoods at stake.”
Escalona pointed out that the government has already raked in $12 billion as revenues from the Malampaya project. Thus, he said it was “wrong” to assume that the government will incur billions of foregone revenues.
He averred that the government’s share in Malampaya is 60 percent of all revenues before expenses and the consortium “is left with 40 percent of all those revenues.”
“From those revenues, they deduct all expenses operational, whatever, that’s part of the business endeavor, and were relegated to the net income at the end of the day. PNOC-EC (Philippine National Oil Company-Exploration Corp.) still gets 10 percent [and] is 10 percent owner… Without doing anything, the government enjoys 64 percent of Malampaya revenues to this day,” he said.
The Department of Energy (DoE) has previously aired the position that matching Udenna Group’s offer to acquire the stake of Chevron and Shell in Malampaya would contradict the government’s mandate to safeguard energy security.
Energy Assistant Secretary Gerardo Erguiza said Wednesday that increasing the stake of PNOC-EC in the gas project is not economical.
“For PNOC-EC to pounce on Chevron’s shares runs counter to their mandate. If acquiring the Chevron shares was so financially lucrative, then why didn’t Shell grab at them at the first opportunity?” Erguiza asked.