PNOC-EC eyes prospects in Indonesia, Latin America

MANILA, Philippines - Publicly-listed PNOC Exploration Corp. (PNOC-EC) is looking at more business opportunities in Indonesia and Latin America.

In a disclosure to the Philippine Stock Exchange (PSE), PNOC-EC said it has completed a review of possible investment in West Papua in Indonesia and is also exploring opportunities in Peru and Colombia.

PNOC-EC said most of the possible projects they are looking at overseas will be on petroleum and coal.

The company said as a state-owned power exploration firm, they are also mandated to help in the energy security of the country for the long-term period.

It said the company concluded a technical evaluation in a regional scale of petroleum blocks offered in Peru and Myanmar.

“The company has also completed preliminary evaluation of four blocks being offered under the 2010 Colombia Open Round,” it added.

Colombia’s Agencia Nacional de Hidrocarburos launced the bidding round for 228 exploration blocks last year. Bid submissions are scheduled for June this year.

The firm is also eyeing a possible entry into the coal mining business in Indonesia “in order to ensure a stable and competitive supply of coal for the Philippine market.”

Since 2007, the state-run exploration companyhas been in a strategic partnership with Putra Asyano Mutiara Timur. The two firms have a joint coal mining project at the Ampah coal concession in East Kalimantan, Indonesia.

PNOC-EC started its legal, technical and financial due diligence in Indonesia in 2008.

The 5,000-hectare concession area is specifically located in Ampah, Tamiang Layang, Barito Utara, Central Kalimantan.About 12.5 million metric tons of potential reserves have been initially computed over a 300-hectare of the Ampah concession area.

“Geologic evaluations and core drilling of exploration wells are still ongoing. After the completion of the drilling activities as well as the legal and financial due diligence, the company will evaluate whether to pursue the buy in and develop the area,” it said.

As this developed, PNOC-EC is seeking the approval of the Bangko Sentral ng Pilipinas (BSP) to take out the equivalent of P425 million in dollar loans to finance its exploration activities.

BSP Governor Amando M. Tetangco Jr. said PNOC-EC is seeking a $9- million short-term foreign currency denominated unit loan from the state-owned Land Bank of the Philippines.

Tetangco said the short-term loan would be used by PNOC-EC to finance its 10-percent share in the drilling costs from the Malampaya Camago II appraisal and development well.

PNOC-EC owns eight petroleum service contracts, including SC 37 or the San Antonio gas power plant and SC 38 or the Malampaya gas field, and holds the rights for the development of the Camago Malampaya oil leg project in offshore northwest Palawan.

The company also has the mandate to develop natural gas infrastructure projects such as the Batangas-Manila natural gas pipeline and the integrated Bataan liquefied natural gas terminal and power plant projects.

PNOC-EC is the oil and gas exploration arm of state-run Philippine National Oil Co. Its shares of stock are 99.78 percent owned by the Philippine government through state-owned Philippine National Oil Co. (PNOC), its mother firm, with the remaining 0.22 percent are held by public shareholders.