South China Resources goes into renewable energy

MANILA, Philippines - South China Resources Inc. is planning to diversify into renewable energy (RE) projects such as geothermal, hydropower and solar.

In a disclosure to the Philippine Stock Exchange, South China said the company sees prospects for growth in the RE area.

“The company plans to secure investment opportunities, either on its own or through joint ventures, in various energy resources, covering the range of geothermal, hydropower and solar energies,” it said.

South China is currently engaged in oil exploration and development. It has stakes in several oil exploration service contracts.

The company is led by brothers Edgardo Reyes and Wilfrido Reyes, chairman and president, respectively. Reyes is also chairman of Gonzalo, Puyat and Sons Inc., which runs Puyat Steel.

The company is now awaiting for the approval of the Energy Regulatory Commission (ERC) on the tariff rules on RE investments.

“South China eagerly awaits the announcement for the feed-in tariffs for energy renewables, which is expected to be in the second quarter of 2010,” it said.

South China also informed that PSE would keep its focus on conventional energy resources “as it explores entry into opportunies in other oil exploration areas as well as that in coal resources.”

It said the global situation in recent years “presents opportunities for the company to seek entry into mineral exploration sector.”

It noted that the demand added by China and India into the current global mineral resource market and into the foreseeable future will have a significant impact in the metals and non-metals market.

It is also optimistic that these ventures will add value to the company.

“We expect to drill a well in Service Contract 60 and if a discovery is made, then it shall open up a new playground for exploration in the country,” it said.

The SC 60 consortium members are South China with 15 percent and Shell Philippines Exploration B.V. and Kuwait Foreign Petroleum Co. holding the remaining 85 percent.

The company expects the first well, Silangan 1, to be drilled in the second quarter. SC 60 is located in offshore northwest Palawan.