Government shelves plan to sell more PNOC-EC shares

The government will temporarily shelve plans to sell more stakes in PNOC-Energy Corp. (PNOC-EC), the oil and gas exploration subsidiary of state-owned Philippine National Oil Co.

“Selling PNOC-EC is a complicated thing. We have to study it very carefully,” PNOC president Antonio Cailao told reporters.

Cailao noted that the PNOC-EC is not just a corporation but it involves natural resources of the country.

“It (PNOC-EC) is into upstream oil and gas development. This may also involve the issue of oil security. We cannot just sell this company, we need to study it very well,” the PNOC executive pointed out.

The government earlier planned to sell PNOC-EC in the last quarter of 2008 or early 2009.

But as the PNOC firms up the terms of reference (TOR) of the bidding process, it deemed necessary to thresh out all remaining issues before the sale is made.

Earlier, PNOC-EC president Rafael Del Pilar disclosed that the deferment was recommended by their financial advisor amid the uncertainties in the market due to prevailing global financial crisis.

He said they have not firmed up yet a new timetable for the privatization and is waiting “for the market to recover.”

PNOC-EC’s privatization was supposed to be undertaken in the latter part of this year.

“The market is still in the wait and see mode. We have to wait for the market to recover,” he said.

But Del Pilar said they have been receiving numerous offers from various investors.

“Aside from San Miguel Corp. which had already announced its intention to bid for PNOC-EC, there are a number of big groups that signified interest,” he said.

PNOC-EC, the oil and gas exploration arm of state-owned Philippine National Oil Co. (PNOC) has been very aggressively allowing private sector to take part in its endeavors. – Donnabelle Gatdula