Trans-Asia allots P500M for capex this year

Trans-Asia Oil and Energy Development Corp. (TA Oil), the publicly-listed oil and gas exploration firm of the Phinma Group, will allot P500 million for its capital expenditure this year.

TA Oil president Francisco Viray said the budget would allow the firm to join the bidding for the 600-megawatt Masinloc coal-fired power plant set this July.

According to Viray, they have raised their capex allocation to be able to participate in the said bidding process.

In 2006, the company had set aside P300 million for its capex.

"We will bid for Masinloc. Our capex is really for the aquisition of Masinloc. The capex will be double because of the acquisition of the government power plant," Viray said.

Viray said the company has submitted a letter of intent to the Power Sector Assets and Liabilities Management Corp. (PSALM).

Former TA Oil president Antonio del Rosario said the P500 million will represent the initial amount of possible investment of the company in Masinloc but this could go higher depending on the need of the bidding process.

The Zambales-based coal-fired power facility is the first big ticket item that would be up for rebidding.

Pre-bid conference for Masinloc is scheduled on May 8 while bidding proper is slated on July 26, 12 noon at the PSALM office in Makati.

It would be recalled that the sale of Masinloc to the YNN Pacific Consortium in 2006 did not push through because of the consortium’s failure to deliver the $227 million upfront payment on the deadline set by PSALM. This prompted the government power privatization firm to forfeit the $14 million performance bond posted by YNN.

Del Rosario said they are also interested in other Napocor generating assets like hydro and geothermal power facilities.

TA Oil, at present, has a total capacity placed at 76.4 MW which includes the 52 MW power plant in Norzagaray, the 3.4 MW in Guimaras and the 21 MW CIP II in Laguna.

The company’s aggressive investment strategy is anchored in its better earnings performance last year.

In 2006, the company recorded a huge jump in earnings, tripling to P327 million from just P100 million in 2005.