Philippine Daily Inquirer: SFC, Chevron Texaco to match Korea firm's Malampaya bid: “SHELL Philippines Exploration BV (Spex) and Chevron Texaco Malampaya LLC has decided to match the bid of a Korean group led by LG International Corp. for about half of the Philippine National Oil Co. Exploration Corp.'s stake in the Malampaya Deep Water Gas-to-Power project…” (ShellNews.net) 9 April 05
Abigail L. Ho
Apr 09, 2005
SHELL Philippines Exploration BV (Spex) and Chevron Texaco Malampaya LLC has decided to match the bid of a Korean group led by LG International Corp. for about half of the Philippine National Oil Co. Exploration Corp.'s stake in the Malampaya Deep Water Gas-to-Power project in Palawan.
Spex and Chevron Texaco, each holding a 45-percent in the natural gas find, thus beat the April 7 deadline to indicate their intention to exercise their right to match the LG-led consortium's offer to buy 4.9 percent of PNOC EC's 10-percent stake in the project.
In a disclosure to the Philippine Stock Exchange yesterday, PNOC-EC said the two firms had finally made up their mind and would challenge the Korean consortium's offer.
"We have already advised LG International Corp. of said development, and we shall refer the matter soonest to the boards of (PNOC) and PNOC-EC, as well as the Privatization Council, for the way forward,'' said PNOC-EC general counsel and corporate secretary.
Privatizing PNOC-EC's interest in Malampaya was one of the conditions that the national government set in 1999 when it gave full guarantee for the $175-million loan that PNOC-EC took out to purchase its 10-percent stake in the project.
Considering the potential of the natural gas project, however, negotiations were conducted between the Departments of Energy and Finance to consider a compromise that would allow PNOC-EC to fulfill that condition while maintaining some stake in the consortium.
Malampaya is the Philippines' single-biggest private sector investment project at an estimated $4.5 billion.
PNOC-EC president Eduardo Ma¤alac said in an earlier interview that part of the sale proceeds would be used to fund more exploration activities that would aid the country in reaching its goal of reaching a 60-percent energy self-sufficiency level by 2010. "This will allow us to have funds to increase and sustain an honest-to-goodness exploration program, which could lead to discoveries of new oil and gas finds in the country,'' he said.
While not indicating how much PNOC-EC expected to fetch from the sale of its 4.9-percent stake in the natural gas project, he said the amount would definitely be "significantly better than the price we bought it for.''
It cost PNOC-EC roughly $175 million to purchase its 10-percent stake in 1999, so Ma¤alac said the sale of its 4.9-percent share now should yield somewhere within the vicinity of $100 million or even higher.
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