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Shell Philippines Exploration BV (SPEX) is considering the sale of its 45% interest in the $ 4.5 billion Malampaya deepwater gas-to-power project.
In a Reuters report, the company said the proposed sale is part of its strategy to increase resilience and ensure the long-term sustainability of its business in the Philippines.
No buyer has yet been named, but Shell said it would ensure the credibility of interested buyers so they could optimize the value of Malampaya.
Last month, SPEX’s sister company, Pilipinas Shell Petroleum Corporation, announced the permanent closure of its refinery in Batangas, which would become a world-class import facility. In a webinar last week, Shell said the facility would no longer be profitable as a refinery.
Shell is looking to reduce oil and gas production by up to 40% in an attempt to focus more on the energy and renewable energy markets.
Malampaya’s natural gas, discovered by Shell in 1991, accounts for about 20% of the country’s electricity. Earlier this month, the chairman of the Senate energy committee, Sherwin Gatchalian, introduced a bill seeking new sources of natural gas, citing the depletion of Malampaya’s resources.
Shell’s divestment plan comes about a year after Chevron agreed to sell its 45% stake in Malampaya to Davao-based magnate Dennis Uy’s Udenna Corporation. The National Petroleum Company of the Philippines holds the remaining 10% stake.
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