Trans-Asia mulls listing of spinoff petroleum unit

MANILA, Philippines - Trans-Asia Oil and Energy Development Corp., fresh from raising P1.627 billion through a stock rights offering, is looking at securing more funds for its petroleum projects through a public listing.

Trans-Asia will spin off and list its petroleum exploration company as early as next year,company executives said.

“I guess in time, as these [petroleum] projects mature, there could be a need for a capital raising effort on the petroleum side as well,” Trans-Asia chairman Oscar Hilado told reporters.

Trans-Asia holds a stake in Service Contract (SC) 6A and 6B in Northwest Palawan, SC 14 (Tara Block) and SC 14B-1 (North Matinloc) in Northwest Palawan, SC 51 in the East Visayan Basin, SC 55 in Southwest Palawan and SC 69 in the Visayas Basin.

“There are plans approved by the board to spin off the oil and gas SCs into a petroleum exploration production company,” said Pythagoras Brion Jr., senior vice-president and chief finance officer of Trans-Asia.

“That is in process right now. Eventually, the hope is that it can be listed at the right time,” Brion said, adding that the initial public offering (IPO) might be conducted in a year or so.

Trans-Asia sold 1.627 billion shares to existing stockholders at P1 apiece.

Fresh capital from the follow-on offering will be used for power generation projects, Hilado said.

Net proceeds from the offering will be used by the company to partially finance its advances for subsequent conversion into equity and investment in a 54-megawatt (MW) wind energy project in San Lorenzo, Guimaras and the planned second 135-MW unit of the coal-fired power plant in Calaca, Batangas.

Trans-Asia president Francisco Viray said the company is still waiting for the wind project to be eligible for the feed-in tariff (FIT).

The FIT scheme, whose implementation is already delayed by almost three years, guarantees the return of investments of renewable energy firms through fixed rates that would be shouldered by consumers over 20 years.

“Part of it will also go to financing of the second unit of our coal fired power plant of our subsidiary South Luzon Thermal Energy Corp. (SLTEC),” Viray said.

SLTEC is a joint venture between Ayala Corp.’s AC Energy Holdings Inc. and Trans-Asia. SLTEC will start operations of the P13-billion, 135-MW circulating fluidized bed power plant in Calaca in 2014.

Viray said Trans-Asia is giving itself three months to make the final decision on the second unit.