The source, who requested anonymity, said BG EC is now conducting exploratory talks with Banco Sabadell for a credit line of more than 100 million euros proceeds from the loan will be used to finance BG EC’s various energy and oil exploration projects including service contracts (SCs) that were signed recently with the Department of Energy (DOE).
This loan was on top of the 250 million euro loan agreement entered into by BG EC with another Spanish bank, Banco Bilbao Vizcaya Argentaria last June. Of this amount, 50 million euros would be used for other projects.
BG EC, a part of the Burgundy Group of Companies, was created to handle the group’s diversification into the oil exploration business.
To intensify its oil exploration business, BG EC also ordered last month from Spain a remotely-operated vehicle (ROV). The ROV is a boat capable of conducting seismic surveys and drilling oil.
The DOE recently awarded SC 61 and 62 to BG EC for oil and gas explorations in Northeast and Southeast Palawan.
The two service contracts were awarded as part of the Philippine Energy Contracting Round 2005 (PECR 2005) launched in Aug. 2005.
The contract area for SC 61 covers 13,560 square kilometers located in a deep-water area in offshore Palawan, adjacent to the prospective service contract area of Shell Philippines. SC 62, on the other hand, covers 13,020 square kilometers located in Southeast Sulu Sea near the Malaysian border.
"We are very pleased that the contract negotiations for Area 2 and Area 3 under PECR have been completed and that BG EC can now proceed with the work program. It is our hope that they will be able to find new resources of commercial quantity in both areas to push forward our drive for energy independence in the midst of surging oil prices", Energy Secretary Raphael P.M. Lotilla said.
For SC 61, Lotilla said BG EC has committed some $44.9 million or about P2.33 billion investments for the seven-year exploration period which will be done in six sub-phases, including the conduct of comprehensive geological and geophysical studies and the drilling of four exploration wells.
Some $43.85 million or about P2.28 billion has been committed for SC 62 for a seven-year exploration period which will also be done in six sub-phases including the conduct of comprehensive geological and geophysical studies and the drilling of four exploration wells.
In 1992, Burgundy brought into the Philippines the $32 billion Jupiter Funds, an asset management company based in London and Bermuda.