PetroEnergy’s stock market debut gets warm reception

PetroEnergy Resources Corp.’s debut at the Philippine Stock Exchange (PSE) yesterday was warmly received by the market, with its share price closing 23 percent higher than its listing price.

At the end of trading yesterday, share prices of PetroEnergy closed at P3.70 per share after reaching a high of P4.20. The shares were listed at their par value of P1 each.

PetroEnergy, a former subsidiary of the Yuchengco-owned Petrofields Corp. (now iPeople), is the first company to list this year at the PSE.

"This is an occasion that the more than 3,000 stockholders of PetroEnergy have been waiting for these past four years. It is to the credit of the progressive leadership in the PSE that a new door was opened only last October 2003, allowing widely-qualified companies like PetroEnergy to be publicly-listed by way of introduction," PetroEnergy chairman Delfin Lazaro said during the listing of the company’s 84 million shares yesterday.

Listing by way of introduction refers to the listing of shares without undergoing an initial public offering or IPO.

Energy Secretary Vincent Perez said he is hopeful that with the listing of PetroEnergy, more oil companies will follow suit. He said oil stocks have been the market movers in the 1970s and 1980s due to major discoveries.

Lazaro said PetroEnergy derives a big percentage of its revenues from its oil operations in Gabon, West Africa which started in Sept. 2002. For the first half of this year, PetroEnergy’s share out of this petroleum production amounted to P86 million plus unsold oil inventory valued at P30 million.

PetroEnergy’s chief administrative officer Arturo Laulion said the company plans to expand capacity to 20,000 barrels per day from the existing 15,000 barrels.

The company is the only Filipino company operating in Gabon. It made two discoveries in Gabon - the Ebouri discovery which is estimated to produce 21 million barrels of oil per day and the Avouma discovery which could contain 17 million barrels of oil.

PetroEnergy’s wholly-owned subsidiary, Vaalco Gabon (Etame), owns 28.1 percent of the production license for the Etame Marine permit area and will act as operator of the project.

The total project cost is estimated at $98 million, including $33 million of prior capital investment.

PetroEnergy’s other exploration projects include Octon-Barselia which is covered by service contract 6A (SC6A) wherein it has a participating interest of five percent; South Sulu (1.19 percent), Ragay Gulf Area (2.31 percent) and Southwest Palawan Area (2.94 percent), and West Palawan-Reed Bank area (five percent).

In May 2003, PetroEnergy restructured its capital through an eight to one reverse stock split, resulting in the reduction of the outstanding capital stock from P674.03 million to P84.25 million and creation of additional paid-in capital of P589.77 million.