Frontier Oil resets IPO

MANILA, Philippines - Local oil and gas explorer Frontier Oil Corp is proceeding with its planned initial public offering (IPO). before the end of the year instead of the original June schedule amid the financial turmoil that recently battered the local bourse.

Frontier Oil chief executive officer Kristoffer Fellowes confirmed the company’s intentions to do an IPO this year.

“The company has already sparked the interest of a number of known business individuals and is planning to further strengthen the company’s board ahead of a what promises to be successful float on the exchange prior to yearend,” he said.

Originally, the company was aiming to do the IPO in May or June but remains optimistic this can be done within the year. It hopes to raise P1.6 billion from the IPO.

Proceeds of the fundraising activity would focus on bringing its onshore gas project and offshore oil field into commercial operations within the next two years, Fellowes said.

SC 52 is a 96,000-hectare onshore oil and gas block located in the Cagayan Valley while SC 50 is the offshore gas field in Northwestern Palawan.

Fellowes said bulk of the estimated P1.6 billion in net proceeds would finance the development of the Northwestern Palawan gas field.

Listed Trans-Asia Oil and Energy Development Corp. of the Phinma Group has already confirmed the extension of its 10 percent option over SC 52.

Under the terms of the extension, Trans-Asia will pay Frontier Oil an option fee that entitles them to a 10 percent participating interest post-drilling. The option fee will be offset against the cost of exploration, if the option is exercised.

“Frontier Oil is now moving rapidly towards commercially exploiting both SC 52 and the second of its major projects, the Calauit oilfield, which lies in Service Contract 50 offshore Northwestern Palawan and is also operated by Frontier Oil,” the company said.