The controversial sale of shares in the Malampaya deep water to gas power project has prompted calls for the government to pursue a probe that will look closely at the buyer’s financial and technical capability to make sure the transaction will not be disadvantageous to the public.
Eight business organizations, namely the Energy Lawyers Association of the Philippines, Financial Executives Institute of the Philippines, Filipina CEO Circle, Integrity Initiative Inc., Investment Houses Association of the Philippines, Makati Business Club, Philippine Women’s Economic Network and Women’s Business Council Philippines have issued a joint statement calling on the Senate and other concerned agencies to investigate and take action on the sales of shares of the members of the Malampaya consortium.
“Given the acquirer’s lack of expertise and heavily financed nature of the proposed purchases, it is highly likely that they will take on partners. The government should scrutinize the buyer’s financial and technical capabilities and interests and should reserve, enforce and exercise its right to block and invalidate transfers of shares and control that may be disadvantageous to the Filipino people,” the statement said.
Last year, a unit of Udenna Corp. acquired a 45 percent stake of Chevron Malampaya LLC. Another unit of the same company then signed a share purchase agreement with Shell Philippines Exploration BV for 45 percent of its stake in the Malampaya project. The deal with Shell has yet to be approved by the Department of Energy.
The groups said there is a need to look into why the government did not exercise its right of first refusal over Chevron and Shell’s shares in the project.
“By failing to do so, the government may have given up tens of billions of pesos at a time when the government needs money more than ever and more importantly has put the country’s energy and national security at risk,” the groups said.
Any deal that involves a significant source of natural resources, especially one as valuable as Malampaya, should always benefit the nation and its people. The deal that gave a buyer with unknown technical and financial capability, other than the fact that the organization is led by someone with close ties to the administration, should have been heavily scrutinized from the start, not only after ordinary folk start raising a fuss.
Has government been looking after the nation’s interests or is advancing only the interests of the chosen few?*
