Trans-Asia buys into service contract of Basic Energy

MANILA, Philippines - Oil and gas company Basic Energy and Trans-Asia Oil and Energy Development Corp., the power generation arm of the Phinma Group, have signed an agreement for the exploration and development of geothermal service contracts.

Under the deal, Trans Asia acquired a 10 percent stake in Basic Energy’s geothermal service contract located in Mabini, Batangas, with the option to boost its stake to up to 40 percent.

Furthermore, Trans-Asia also has the option within six months to acquire up to 60 percent of Basic Energy’s other geothermal service contracts in Mariveles Bataan, East Mankayan in Benguet, West Bulusan in Sorsogon and Mt. Iriga in Camarines Sur.

Basic Energy said the agreement would lead to a firm and mutually profitable partnership in the geothermal energy field.

“We welcome Trans-Asia’s intention to potentially become our major partner in the development of Basic’s various GSCs. We will work for a resultant synergy to more quickly develop the geothermal power requirements of our growing economy,” said Basic Energy CEO Oscar de Venecia.

Under the terms of the agreement, Trans-Asia will fund the onshore gravity program for the Mabini service contract and upon its completion, elect its final participating interest in the project of up to a 40 percent-stake, Basic Energy said.

“Both Basic Energy and Trans-Asia also agreed on the sharing costs for the drilling of exploratory wells for the Mabini project. The contract calls for the first exploratory well to be drilled by July 2015,” Basic Energy.

For the Mabini project, Trans Asia will have the right to be first in negotiating a purchase accord with the consortium for all the electricity output to be generated by the project, at commercially-competitive rates.

Furthermore, the Phinma owned company will also have first call on purchasing the power to be generated by the Mabini service contract and in the construction of the required power generation plants.

“This will hopefully result in significant income streams for both our companies and other partners who may join our consortium, as we go through the development of the Mabini geothermal steam fields and then to power generation and supply,” said De Venecia.