Press Release
October 4, 2021

DOE gave green light to Chevron-Udenna deal despite lack of legal basis - Gatchalian

Senator Win Gatchalian chastised energy officials for approving the sale of Chevron Malampaya's 45% stake in the Malampaya gas field to Udenna Malampaya LLC amid their own admission that there was "insufficient foundation" of legal basis to do so.

Such claim was made after Gatchalian asked officials of the Department of Energy (DOE) if they stand by their evaluation of the financial and technical capabilities of Udenna Corporation's unit that acquired the stake of Chevron.

"I'm discouraged by the fact that you admitted that there is insufficient foundation for legal basis, yet you pursued the recommendation and ultimately the DOE secretary approved it. So, there's insufficient foundation on a business that is worth $500 million that supplies 3.7 million households and powers 27% of our generation in Luzon. Such an important asset was sold to a company that, based on your findings, is unqualified," said Gatchalian.

During last Tuesday's hearing, the Senate Energy Committee Chairperson pointed out that such position by the DOE's Energy Resource Development Bureau - the group that assessed Chevron's transfer of its stakes to Udenna's UC Malampaya Philippines Pte. Ltd. - has not been articulated to the committee in any of the submitted documents.

"So, kayo-kayo lang ang nakakaalam nyan in other words," Gatchalian noted to which he was given an affirmative answer by DOE-ERDB Director Cesar de la Fuente.

Based on the assessment of DOE officials who reviewed and recommended the approval of the transaction, they said that they almost did not go through evaluating UC Malampaya technically because the transaction involved only the sale of shares and the second party remains to be the same company with the same set of employees and technical experts.

What even made the senator more disappointed during the Senate hearing was when DOE officials showed in their presentation that the technical and legal aspects of UC Malampaya have been evaluated but suddenly changed the name to UC38 when it needed to be financially evaluated.

"You evaluated the technical and legal aspects of UC Malampaya pero pagdating sa financial aspect, naging UC38 na. Kasi hindi pumasa si UC Malampaya sa financial evaluation," said Gatchalian.

"To be honest about it, what I am getting here is that you legitimized an illegitimate transaction. Parang this transaction is not qualified pero pinilit ninyo to be qualified and legitimized it. That was a clear violation in the transaction. So, why despite the violation, your department approved this transaction?" Gatchalian asked the DOE.

The sale was finalized in March last year.

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Chevron-Udenna deal inaprubahan ng DOE kahit walang sapat na batayang ligal - Gatchalian

Kinastigo ni Senador Win Gatchalian ang mga opisyal ng Department of Energy (DOE) sa pagsang-ayon sa pagbenta ng 45% stake ng Chevron Malampaya sa Malampaya gas field sa kumpaya ng negosyanteng si Dennis Uy na Udenna Malampaya LLC kahit na "insufficient foundation" ang ligal na batayan ng desisyon ng DOE.

Ito ang inamin ng DOE sa gitna ng panggigisa ni Gatchalian sa mga opisyal ng ahensiya nang tanungin sila kung mapapanindigan ba nila ang kinalabasan ng kanilang pagsusuri sa pinansyal at teknikal na kapasidad ng kumpanya ni Uy.

"Nakakapanlumong malaman ang pag-amin nyo na hindi sapat ang pundasyon ng inyong ligal na batayan ngunit itinuloy nyo pa rin ang pagrerekomenda dito at kinalaunan ay inaprubahan ng DOE secretary ang transaksyon. Isipin niyo na lang ang sinasabi ninyong walang sapat na pundasyon ang kumpanyang inaprubahan ninyong bumili ng negosyong may halagang 500 milyong dolyar na nagsusuplay sa 3.7 milyong sambahayan o 27% ng kabuuang pangangailangan ng Luzon. Ang isang napakahalagang asset ng gobyerno ay napasakamay ng isang kumpanyang batay sa mismong findings ninyo ay hindi kwalipikado," ani Gatchalian.

Ang pahayag na "insufficient foundation of legal basis" na mismong galing kay Director Cesar de la Fuente ng Energy Resource Development Bureau ng DOE ay ikinadismaya ng Senate Energy Committee Chairperson dahil hindi man lamang daw ito nilagay sa alinmang dokumentong isinumite sa komite bago ang pinakahuling pagdinig.

Mas lalo pang nadismaya si Gatchalian sa aniya'y nakakalito at tila paglilihis sa tunay na sitwasyon ng Udenna Malampaya nang iprinisinta ng DOE ang kanilang ulat sa komite.

"Sa pagsusuri nyo, pagdating sa usapin ng technical at legal aspects, UC Malampaya ang kinunsidera ninyo pero pagdating sa financial aspect, iniba niyo na ang pangalan, naging UC 38 na kasi hindi pumasa si UC Malampaya sa financial evaluation," sabi ni Gatchalian.

UC 38 ang ipinalit sa pangalan ng Chevron Malampaya.

"Sa totoo lang, ang dating sa akin ng lahat ng ito ay pinilit ninyong gawing lehitimo ang isang iligal na transaksyon. Lumalabas kasi na hindi kwalipikado ang Udenna Malampaya pero pinilit ninyong maging kwalipikado at ligal ang transaksiyon. Malinaw na may paglabag ang transaksyon. Pero sa kabila nito, bakit pinayagan nyo pa ring magpatuloy ang transaksyong ito?" tanong ni Gatchalian sa DOE.

Naging pinal ang nasabing bentahan noong Marso ng nakaraang taon.

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