Filoil to form joint venture with ATI

Filoil Development and Management Corp. (Filoil), the real estate development arm of the state-owned Philippine National Oil Co. (PNOC), is forging a joint venture agreement with Asian Terminal Inc. (ATI) within this quarter, a company official said.

In an interview, Filoil president and chief executive officer Cirilo S. Martinez said the deal will involve an extensive cargo handling scheme that would allow ATI to use the properties of Filoil located in Rosario, Cavite.

Specifically, the publicly-listed ATI, the only port operator in South Harbor, would be able to construct a facility within the 118 hectare-property of Filoil which could be used by different economic processing zones in that area.

Martinez explained that the agreement would allow ATI to transport goods from Cavite to Manila passing through the properties of Filoil.

"They (ATI) would refurbish existing terminals. If needed, they would build new terminals," he said.

According to Martinez, they would be sharing revenues with ATI as part of the latter’s tease payment to Filoil.

The 25-year lease agreement he said, would be done in lieu of the earlier plans of developing the whole 118-hectare property.

Martinez said they earlier pre-qualified at least three consortium for the development of the entire property into a mixed-use commercial complex.

But due to some complications in the plan, they have decided to just develop the property in parcels.

The JV with ATI, Martinez said, would pave the way for future developments in their property.

He said the Filoil property, worth P1.5 billion, is envisioned to be developed into a business park, retail-commercial area including affordable housing areas and an industrial estate.

Unlike other subsidiaries of PNOC, Filoil will only privatize its real estate assets. PNOC plans to sell all of its subsidiaries to the private sector.