SMC still keen on PNOC-EC

MANILA, Philippines - Diversifying food and beverage conglomerate San Miguel Corp. remains interested in PNOC-EC, the oil and gas exploration arm of state-run Philippine National Oil Co. even as the government decided to jack up the amount of shares it is selling to the public from 40 percent to 60 percent.

“Yes we will join the bidding,“ said San Miguel president Ramon S. Ang in a text message when asked whether the conglomerate was still keen on PNOC-EC

The government last week sought the approval of the PNOC-EC board for its proposal to sell 60 percent interest in PNOC-EC compared with the previous plan of just divesting 40 percent. It hopes to generate as much  as P15 billion from the sale of its stake in PNOC-EC.

Three financial advisors were hired to handle the privatization of PNOC-EC. These are the Development Bank of the Philippines, Citibank Group and ATR Kim Eng Securities gRoup.

The government has been postponing the sale of PNOC-EC shares due to the volatility of oil prices which could affect the bidding price. It previously planned to sell the stake in November 2008 but opted to wait for better market conditions.

Analysts said PNOC-EC was a compelling buy  since it owns a 10-percent stake in the $4.5-billion Malampaya deep water gas to power project 38 in Northwest Palawan.

The Malampaya, which is located in offshore Palawan, is the country’s largest natural gas field, powering three power plants in the country. It is operated by Shell with a 45-percent stake, in partnership with Chevron and PNOC-EC with a 45-percent and 10-percent participating interest, respectively.