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The Philippines extends the production contract for the Malampaya gas block by 15 years

The President of the Philippines has signed the Renewal Agreement for the Malampaya Service Contract (SC38) for the Malampaya gas field, which was expected to expire on 22 February 2024 and which is extended by 15 years to 22 February 2039.

The Service Contract 38 consortium, which includes Malampaya Energy XP (MEXP), a subsidiary of the Philippine company Prime Infrastructure Capital (45%, acquired from Shell in late 2022), Udenna Corp (45%, acquired from Chevron) and the state-owned Philippine National Oil Company Exploration Corporation (10%), will have to conduct a minimum work programme and to drill at least two deepwater wells during the Sub-Phase 1 from 2024 to 2029. However, gas production is declining and the field may run dry by 2027.

The 429 mcf/day (12.1 mcm/day) Malampaya field was first discovered in 1991 and began commercial operations in 2001. It notably supplies natural gas for three power plants totalling 3 GW in the Batangas province, on the country’s largest and most populous island of Luzon.