Shell Petroleum N.V. has signed a deal with Malampaya Energy XP Pte Ltd, a subsidiary of Udenna Corporation, for the sale of its 100 percent shareholding in Shell Philippines Exploration B.V. (SPEX).
The base consideration for the sale is $380 million, with additional payments of up to $80 million between 2022 to 2024 contingent on asset performance and commodity prices, Shell revealed. Subject to partner and regulatory consent, the deal, which is said to have no impact on other Shell businesses in the country, is targeted to complete by the end of this year. SPEX staff will continue their employment under the new ownership, Shell highlighted.
Shell noted that the Philippines remains an important country for the company after more than a century of successful operations. The business added that it will continue to pursue opportunities in the Philippines where it can leverage its global expertise in line with its strategy. SPEX holds a 45 percent operating interest in Service Contract 38 (SC38), which includes the producing Malampaya gas field.
“Since it began commercial operations in 2002, Malampaya has supplied a significant portion of the Philippines’ energy demand and it will continue powering the country with indigenous gas following a safe transition of the asset and its experienced workforce,” Wael Sawan, Shell’s upstream director, said in a company statement.
“Today’s announcement is consistent with Shell’s efforts to shift our upstream portfolio to one that is focused on nine core positions,” the Shell representative added in the statement.
SPEX received its license to operate in the Philippines back in 1991. The company’s partners in SC38 are UC38 LLC, also a subsidiary of Udenna Corporation, which holds a 45 percent interest, and Philippine National Oil Company Exploration Corporation, which holds the remaining 10 percent stake in the asset.
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