7 international banks show interest in naphtha project of RP

Seven international financial institutions have submitted formal proposals to act as financial adviser for the country’s first-ever naphtha cracker plant.

The international institutions are the Deutsche Bank, the Bank of Tokyo-Mitsubishi, Lehman Brothers, Bank of America, ABN-AMRO, Chase Manhattan, and Sumitomo Bank.

The winning institution would handle the $600-million naphtha cracker project in Limay, Bataan, which will have a capacity of 600,000 to 700,000 metric tons per year.

"We were surprised by the number of firms which want to become the financial adviser for our naphtha project considering the economic crisis," Jose Gangan, president of the PNOC Petrochemical Development Corp. (PPDC) said. PPDC is a subsidiary of the Philippine National Oil Co. (PNOC).

While the applications are being studied by PNOC and PPDC, the project proponents are working on the details for the shareholding contract. Involved in the project are 11 foreign and domestic corporations.

These are: Petron Corp., Petrochemicals Corp. of Asia-Pacific, Bataan Polyethylene Corp., Philippine Resins Industries Inc., D&L Industries Inc., Sumitomo Corp., Mitsubishi Corp., Mitsui & Co. Ltd., Itochu Corp., Chinese Petroleum Corp., and PPDC.

The PPDC will acquire a 34-percent equity and it will be involved in a bond float to raise funds for the acquisition. The plant should be operational by 2004 to 2005.