By Myrna M. Velasco
Outgoing Manila Electric Company (Meralco) President Oscar S. Reyes who will be leaving his post in May this year, will reportedly be transferred to a company that will be the corporate vehicle for the gas investments of the Pangilinan-led group.
Oscar S. Reyes
According to sources from the camp of business tycoon Manuel V. Pangilinan, Reyes will lead the planned gas project-developments of the conglomerate, including reported plunge into liquefied natural gas (LNG) investments. Reyes will be replaced by lawyer Ray C. Espinosa as president and CEO of Meralco.
It has been hinted that Reyes could either be with PXP Energy Corporation (formerly Philex Petroleum Corporation) or a new corporate vehicle that will be the gas investment unit of the MVP group.
Aside from targeted venture in the LNG sector, sources noted that Reyes’s “midas touch’ on oil and gas exploration may be needed anew in the proposed Recto Bank upstream petroleum development of the group.
It has to be noted that Reyes was the country chairman of Shell Philippines when the scale of commerciality of the Malampaya deep water gas-to-power project came into fruition.
And for the company’s planned LNG projects, the camp of Davao businessman Dennis A. Uy has already given the MVP group preferential rights to be its partner in the integrated US$2.0 billion LNG terminal and power plant projects.
Pangilinan himself sounded off that they are open to joining Uy’s LNG ventures, but equity take in the corporate vehicle of the projects will still be subject to negotiations. Uy’s Dennison Holdings is also the MVP group’s partner in the Recto Bank petroleum exploration.
The gas assignment that will be placed onto Reyes’s charge will somehow bring new challenges to this long-time industry executive – and this could be another exceptional milestone because the entire Philippine energy sector is also traversing gas market reset.
LNG is considerably a game-change from the indigenous gas that Malampaya had bestowed to the country’s gas-fired power facilities since year 2001 – because from sourcing that fuel from home base, the country will resort to importation this time.
And with offshore procurements, it is also undeniable that the Philippine gas market will be exposed more to cost pressures linked to global economic and geopolitical factors.
Nevertheless, for the MVP group, its long-wished exploration and development at the Recto Bank is anchored on hopes that a new commercial-scale discovery could feasibly replace the Malampaya field’s production.