Trans-Asia unit shifts to oil exploration

MANILA, Philippines - A unit of Phinma-controlled Trans-Asia Oil and Energy Development Corp. is shifting its focus to oil projects following its failure to break into the power generation business.

In a disclosure, Trans-Asia said it approved “the change of primary purpose of Trans-Asia (Karang-Besar) Petroleum Corp., from power generation to oil and gas exploration and production.”

Trans-Asia Petroleum will also increase its authorized capital to P1 billion from P40 million.

Trans-Asia president Francisco Viray said Trans-Asia Petroleum could have been the company’s vehicle for the operation of power barges.

However, the second round of bidding and negotiated sale of the Power Sector Assets and Liabilities Management Corp.’s four power barges failed as lone bidder Trans-Asia’s P95-million offer fell way below the floor price.

Designed as base-load plants, Power Barge 101, 102, 103 and 104 are nominal 32-megawatt (MW) barge-mounted, bunker-fired diesel generating power stations that consist of four identical Hitachi-Sulzer diesel generator units rated at eight MW each.

Meanwhile, Viray said fresh funds from the increase in authorized capital will be used to fund oil and gas projects.

In a separate disclosure, Trans-Asia said it will sell an additional 212.25 million shares to existing stockholders through a stock rights offering.

In July, Trans-Asia announced the rights offer for 1.415 billion shares. Every two shares owned will allow an investor to buy one new share.

Earnings of Trans-Asia Oil and Energy Development Corp. almost doubled to P220.44 million in the first half, way above the P129.67 million in the same period last year due to increased electricity sales, backed by higher prices.

Trans-Asia is on track to hitting a 20-percent growth in profits to a record P489 million this year, Viray said.

The company owns and operates four plants with an aggregate production capacity of 186.4 MW. The bulk of energy sales came from contract customers, with excess output sold to the spot market.

Trans-Asia will enter into P33 billion worth of new projects in the next five years.

In the next three years, generating capacity is projected to increase to 347.4 MW as three scheduled projects go onstream – the CIP II Power Plant (2012) in Laguna, 20-MW Maibarara Geothermal Inc. renewable energy project also in Laguna (2013) and 135-MW South Luzon Thermal Energy Corp. circulating fluidized bed power plant in Batangas (2014).

Trans-Asia holds Service Contract (SC) 6A and 6B in Northwest Palawan, SC 14 (Tara Block) and SC 14B-1 (North Matinloc) in Northwest Palawan, SC 51 in the East Visayan Basin, SC 55 in Southwest Palawan and SC 69 in the Visayas Basin.

Trans-Asia, which is 54.8-percent owned by Phinma Corp., is also into oil exploration, cement manufacturing and coal trading.