PXP asks gov't to reconsider Malampaya takeover bid

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Metro Manila (CNN Philippines, December 6) — Businessman Manny Pangilinan is not giving up on his plan to take over the operations of the Malampaya gas facility off Palawan.

Pangilinan's PXP Energy Corporation has appealed the government's decision rejecting its unsolicited proposal to further develop the Malampaya natural gas field, even after it runs dry.

"This is to inform the Exchange that we have filed a letter to the Department of Energy requesting for a reconsideration of their decision on PXP's Unsolicited proposal," the company said in a disclosure to the Philippine Stock Exchange on Friday.

Shell Philippines Exploration BV runs the show in the Malampaya. PXP has offered to take over the drilling and extraction works from the Malampaya Consortium, whose deal to explore the area for oil deposits ends in 2024.

Once the petroleum exploration and production contract lapses, full control and ownership of the Malampaya natural gas and oil facilities will be turned over to the national government.

Energy Secretary Alfonso Cusi said back in September that the Malampaya reservoir — which supplies about 30 percent of the country's electricity needs — is only good until 2027.

The government is now in talks with the Chinese government for a joint oil and gas exploration to secure energy supply.

PXP earlier cited Malampaya's "strategic" position in the West Philippine Sea to justify its bid. This is where its subsidiary, Forum Energy, holds the rights to drill off the waters of Recto Bank, also known as Reed Bank, an oil-rich sea feature within the Philippines’ 200-nautical mile exclusive economic zone that China is also claiming.

PXP also planned to acquire Chevron's 45 percent stake in Malampaya as another route to gain access to the gas field. However, businessman Dennis Uy's Udenna Corporation already has these shares after completing the sale in November.

CNN Philippines' Melissa Lopez contributed to this report.