Panel to discuss IPOs of Caltex and Shell

The Department of Energy (DOE) will meet with the Department of Justice (DOJ) and the Philippine Stock Exchange (PSE) to discuss the initial public offering (IPO) plans of Pilipinas Shell Petroleum Corp. and Caltex Philippines Inc.

"We will meet separately with the DOJ officials and PSE chairman Alicia Morales-Arroyo later this week to discuss this issue," Energy Secretary Vincent S. Perez said in a press conference yesterday.

"I think if there is anyone between the two who would list first, it would be Shell. I think there is going to be a lot of intense discussions with them," he said.

This recent pronouncement of Perez will put pressure anew on the two local oil refiners to list at least 10 percent of their equities in the local stock market, a requirement under the RA 8479 or the Downstream Oil Industry Deregulation Act.

Both Caltex and Shell have been asking for an extension to comply with the provision of RA 8479 even on or before the lapse of the supposed three-year period for the oil refiners to submit themselves to an IPO, or on February 2001.

Taking into consideration a DOJ opinion on the IPO schedule, the DOE has repeatedly given in to the request of the oil firms.

This DOJ opinion came in the defense of the oil firms, saying that the law is not mandatory but rather directory in nature.

The DOJ noted that "based on the prevailing economic conditions, it is expected that an IPO at this time may well fall short of the norms of a successful offering both in terms of pricing and distribution if undertaken within the period."