PNOC-EC allots P5B for capex, investments next year

MANILA, Philippines - PNOC-Exploration Corp., the petroleum and coal exploration unit of state-owned Philippine National Oil Co. (PNOC), has budgeted around P5 billion next year for investments and capital expenditures, top company executive said yesterday.

Newly appointed PNOC-EC chairman and CEO Gemiliano Lopez Jr., a former Manila mayor, told reporters that the bulk of the proposed budget for next year will go to investments, with the rest for operating expenses and other capital expenditures.

He said this budget proposal will help support the company’s target of a five percent income growth to P2 billion next year from the P1.9 billion projected earnings this year.

Lopez said the “on-track income projection” would be anchored on the continuing growth in revenues coming from its share in the Malampaya natural gas project and the reduction in its expenses.

The company, he said, also has P1 billion cash on hand that could be used to support its investment and expansion plans.

According to Lopez, PNOC-EC would be focusing on four priority projects next year.

These include the Isabela coal mine and a 50-megawatt power plant project expected to be completed by 2013.

Another project is the 100-MW Malangas coal-fired power plant in Zamboanga, Sibugay which will utilize coal from both Isabela and Malangas.

At the same time, PNOC-EC also intends to maximize and develop the use of natural gas with its 80-MW Batangas Gas Power Plant (BGPP) alongside the proposed Bataan LNG receiving terminal. 

The BGPP intends to use the natural gas from Malampaya for electricity generation to augment the power requirement of the Luzon grid.

The Bataan Gas Receiving Terminal, on the other hand, will consist initially of offshore LNG receiving and re-gasification facilities. The planned terminal will be located at the PNOC-Alternative Fuel Corp. (PNOC-AFC) industrial complex.

 “These projects, which are currently in the planning and market study stages, are part of the company’s response to the country’s growing demand for energy, and are consistent with the government’s thrust to actively promote Public-Private Partnerships,” Lopez said.

He noted that the projects are in response to the Department of Energy’s foreseen need for additional installed capacity in the Luzon grid by 2011 due to the retirement of two oil-fired power plants.

 “As such, the current administration, through the DOE has also tapped PNOC-EC to develop energy resources that would fuel existing and planned power plants,” he said.

The projects, Lopez said, are also in line with PNOC-EC’s mandate of providing stable supply for the country’s energy requirements, and may be considered as the results of PNOC-EC’s efforts in exploring and developing indigenous energy sources for the country.