Billionaire Enrique K. Razon Jr. has tapped Sebastian C. Quiniones Jr., former managing director of Shell Philippines Exploration B.V. (SPEX), to become the general manager of his upstream oil and gas business under Prime Exploration Pte. Ltd. effective August 17 this year.
Prime Exploration is the entity of the Razon group that is currently negotiating with Malampaya Energy XP (MEXP) of Davao businessman Dennis Uy to acquire the 45 percent stake of SPEX in the country’s commercial gas field.
In an announcement, Prime Exploration said, “Quiniones’ appointment bolsters the commitment of Prime Infra to strengthening its talent capabilities in the upstream industry as it awaits regulatory consent to acquire the shares of the Malampaya operator.”
Prime Infra President and CEO Guillaume Lucci further asserted that “with his deep industry expertise and unparalleled experience, I am confident that Mr. Quiniones will help ensure that a critical power asset is steered to further development and progress.”
There are questions being raised on the manner of acquisition that Prime Exploration has been pursuing on the operating stake of the Malampaya field, because that transaction between MEXP and Shell never reached transaction closing due to the previous decision of minority shareholder and state-run Philippine National Oil Company-Exploration Corporation (PNOC-EC), which withheld its consent to the sale transaction.
Energy Secretary Raphael P.M. Lotilla told reporters that he has directed PNOC-EC to tap advisors and consultants to aid in the evaluation of Shell’s operating stake divestment being eyed by the Razon group.
Prime Exploration similarly emphasized that “the acquisition is still subject to the consent of the PNOC-Exploration Corporation (PNOC EC) and the Department of Energy.”
The Razon firm expounded that “once such consent is given and Prime Infra assumes full ownership and control of SPEX, Quiniones will work towards fulfilling the vision of Prime Infra in accelerating investments for the expansion of the Malampaya deep-water gas-to-power project.”
The initial duration of Service Contract (SC) 38 of the Malampaya field will expire in February 2024; and there are no clear pronouncements from government yet if a license extension will be accorded to the Razon group.
In the past administrations, Shell applied for a 15-year license extension but that just ended up gathering dust in the files of the DOE, because it was never acted upon by the previous energy chiefs.
To the Razon group, it noted that Quiniones’ employment with them “is a reflection of our commitment to ensure that, upon receiving the necessary regulatory approvals and taking over SPEX, we will deliver outstanding operational performance and further the potential of the service contract.”
When the sale is consummated, all rights and obligations of the existing Malampaya gas operator will be transferred to Prime Infra – including the pending $1.1 billion Malampaya arbitration case which is pending with the Supreme Court; and the extraction of the $700 million-$800 million worth of ‘banked gas’ that shall be funneled to PNOC.