Royal Dutch Shell has agreed to sell its stake in the Malampaya offshore gas field in the Philippines for $460 million. The major sold its 45% stake in Service Contract 38 (SC38), a deepwater license which includes the producing gas field, to a subsidiary of the Udenna Group, which already holds a 45% stake in the project. The divestment is part of the company’s strategy to narrow its oil and gas operations.
The base consideration for the sale is $380 million, with additional payments of up to $80 million in 2022 and 2024 contingent on asset performance and commodity prices, according to Shell. The deal is due to complete by the end of 2021.
The Malampaya gas field, discovered in 1991, currently supplies fuel to power plants that deliver about a fifth of the country’s electricity requirements, based on energy ministry data.