A senior administration congressman on Sunday, November 7, called on reelectionist senators not to subject to “political grandstanding” the controversy relating to the decision of Shell Petroleum N.V. to sell its 45 percent operating stake in the service contract that includes the offshore Malampaya gas field.
Surigao del Sur Rep. Johnny Pimentel said senators should be made to realize that in their bid to score political points for their 2022 election bids, the country’s attempt to lure investors to aid economic rebound will suffer.
“We would urge our senators – especially those seeking to extend their terms in office in 2022, and who are eager to draw attention to themselves – to spare Shell from their publicity stunts,” said Pimentel, chairman of the House Committee on Strategic Intelligence which has jurisdiction over economic intelligence issues.
He warned: “If we make it difficult for foreign investors like Shell to get in and get out of existing petroleum service contracts, then nobody will help us develop our vast deep-water gas deposits that we need badly to meet our growing demand for electricity.
Pimentel recommended that senators should address more pressing issues like rising unemployment if their intention is to win voters in 2022.
Earlier, the Philippine Statistics Authority (PSA) reported that the country’s unemployment rate surged to 8.9 percent in September, even as the government began easing restrictions despite a fresh surge in COVID-19 cases.
“We cannot afford to send the wrong signal to would-be foreign gas developers because we will surely need their help in the months ahead,” said Pimentel.
“We will definitely need the likes of British Petroleum plc, Exxon Mobil Corp., Saudi Arabian Oil Co. and Total Energies SE if we want to harness our other gas supplies beneath the West Philippine Sea,” he stressed.
According to Pimentel his concern is not on Malampaya which at 20 years old is already a mature field in a state of declining gas production.
“We are more concerned here about the undeveloped Sampaguita gas discovery located some 250 kilometers southwest of Malampaya,” Pimentel said.
He explained that Sampaguita’s operator is expected to eventually bring in a “large and proficient foreign partner to help develop the field from zero to full production.”
“And we do not want all the political badgering around Shell’s Malampaya divestment to drive away prospective foreign investors that might be interested in farming into Sampaguita’s service contract,” Pimentel said.
Sampaguita, which lies in Service Contract (SC) 72 operated by Forum Energy Ltd., is believed to contain more gas reserves than Malampaya when the latter was first discovered in 1989, according to an independent assessment by Weatherford Petroleum Consultants.
Shell recently signed an agreement to sell its 100 percent stake in Shell Philippines Exploration B.V. (SPEX) to Malampaya Energy XP Pte Ltd, a subsidiary of Udenna Corp.
SPEX holds a 45 percent operating interest in SC 38, which includes Malampaya.
The transaction is expected to close on Jan. 1, 2022. (Melvin Sarangay)