Prime Infrastructure Capital Inc. (Prime Infra), through one of its subsidiaries, has completed its acquisition of the 45-percent operating stake in the Malampaya deep water gas-to-power project effective November 1, 2022.
This after Prime Infra’s subsidiary assumed full ownership and control of Malampaya operator Shell Philippines Exploration B.V. (SPEX). The renaming of SPEX to Prime Energy Resources Development B.V. (Prime Energy) is already in process following the acquisition of SPEX shares.
“With great pride and honor, we welcome the SPEX team to our Prime Infra family of companies. The Malampaya asset begins a new chapter today as we continue to build on the legacy of this world-class installation in helping achieve national energy security and independence,” said Prime Infra Chairman Enrique Razon, Jr.
Prime Infra’s full ownership of SPEX is the culmination of the transition process for a safe and seamless handover of operations from Shell.
To facilitate the seamless transition of the asset operations from Shell, Prime Infra established a team of commercial, change management and upstream industry experts.
A team of around 300 SPEX world-class employees joins the Prime Infra group bringing with them highly specialized skills and technical knowledge that will continue to operate the deep water gas-to-power project. Prime Infra management formally welcomed the SPEX team at the Manila office, Onshore Gas Plant, Batangas Supply Base and Shallow Water Platform via a two-day onboarding activity to be capped with a hybrid town hall on November 2 across all sites.
In October 2022, the Department of Energy (DOE) approved the transfer of shares of SPEX to a Prime Infra subsidiary. Prior to this, consents were also given by the joint venture partners in the Malampaya Service Contract 38 consortium, UC38 LLC and the PNOC Exploration Corporation (PNOC EC).
The next urgent step for Prime Energy is to sustain and expand gas production in light of the growing electricity demand.
“As a purpose-driven company, Prime Infra is committed to invest in critical infrastructure that supports the country’s urgent needs. We are excited to be part of the next phase of Malampaya, and to further the potential of SC 38 as we work on securing the license extension,” said Prime Infra President and CEO Guillaume Lucci.
The Malampaya project is one of the country’s most important power assets, as it produces natural gas to power plants in Batangas City that power up to 20% of the Luzon’s total electricity requirements. It began operations in 2001, with the consortium’s license for the project set to expire in 2024.
Prime Infra is well-positioned to carry on the track record of Malampaya. Apart from the upstream gas project, other developments in its energy portfolio are renewables (solar and hydropower), waste-to-fuel, and a gas-fired power plant in Iraq.