Business community seeks 'transparent' probe into Udenna—Malampaya deals


Posted at Nov 11 2021 04:48 PM

MANILA— Several business groups have urged the government and the Senate to throughly investigate Udenna Corp's controversial acquisition deals for the majority stake in the Malampaya natural gas project, a "critical energy source" in the country.

Udenna, owned by Davao-based businessman Dennis Uy, an ally of President Rodrigo Duterte, had acquired at least 90 percent of Malampaya through a deal with Chevron and Shell.

Uy’s Udenna purchased Chevron’s 45 percent share for $565 million, and Shell’s 45 percent stake for $460 million, for a total of $1.025 billion.

"Malampaya involves a lot of questions that need to be resolved so that the transaction becomes transparent and understandable to everybody," Philippine Chamber of Commerce and Industry president Benedicto Yujuico told reporters in a briefing. 

"I would say our position is yes, we should look into it and let us really find out what is going on," he added.

On Wednesday 8 other business groups urged the Senate to "fully explore why the government did not exercise its right of first refusal over Chevron’s and Shell’s shares in Malampaya."

By not doing a thorough review, the government may have lost "tens of billions" and put the country's energy sector and national security at risk, the statement said. 

The groups' statement also pointed out other issues such as why the government allowed the sale of a "critical energy asset" to a group which, at the time of bid, has no experience or track record in gas exploration and production. 

The probe should also focus on the buyer's financial and technical capabilities. 

The statement was issued by the following: 

  • 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
  • Women’s Business Council Philippines

Sen. Sherwin Gatchalian, who chairs the Senate Committee on Energy, earlier called the sale and the approval by the Energy Department as "lutong Macau," the colloquial term for "rigged." 

"After conducting 3 hearings, after going through all the documents, which all came from DOE, ang masasabi ko lang ay lutong macau itong transaction and lutong macau 'yung approval," he said in an interview on ANC's Headstart. 

The Department of Energy rebutted by saying it has not broken any law in line with the deal. 

Both Energy Secretary Alfonso Cusi and Dennis Uy also face graft charges. Complainant and lawyer Rodel Rodis called the deal "the most incredible crony agreement in the entire history."

But Cusi, head of ruling party PDP-Laban, said the case was political "harassment." 

Udenna Corp, meanwhile, maintained the validity of the acquisition and that the share sales "were above board and legal."

When asked about the Palace stand on the issue, Presidential Spokesperon Harry Roque said Thursday: "Nagsampa na ng kaso po Ombudsman, so ang Ombudsman na po ang mag-iimbestiga d’yan. Iyan naman po talaga ang katungkulan ng Ombudsman."

(A case has been filed with the Ombudsman, so the Ombudsman will investigate. That's the job of the Ombudsman.)


Watch more on iWantTFC

— with reports from Warren De Guzman and Jamaine Punzalan, ABS-CBN News