TA Oil finalizes PEPC listing

MANILA, Philippines - Listed Trans-Asia Oil and Energy Development Corp. is finalizing its plan of distributing shares of its oil exploration subsidiary as a property dividend.

The move, which will also include the listing of Palawan 55 Exploration & Production Corp. (PEPC), will formalize the separation of Trans-Asia’s power production and oil exploration businesses, executives said.

“We are in the process of separating our oil exploration activities and setting up a subsidiary for that,” Phinma Corp. president and vice-chairman Ramon R. del Rosario Jr. said in an interview. Phinma is the parent firm of Trans-Asia.

“The current Trans-Asia will focus on power generation,” del Rosario said.

In November, Trans-Asia incorporated PEPC to take charge of the development of Service Contract (SC) 55 in Southwest Palawan.

“The way to do it is to initially separate [the oil and power business] and give [Palawan55] as property dividend to our shareholders but set aside a certain portion that will be floated to the public,” Del Rosario said.

Trans-Asia president Francisco Viray said, in a separate interview that the listing plan and property dividend option for PEPC is under study.                        

A property dividend is an alternative way of rewarding shareholders aside from cash dividends. Stockholders will receive shares or assets in a subsidiary company.

In 2011, Philex Petroleum Corp. went public after its parent firm Philex Mining Corp. distributed the petroleum firm’s shares as a property dividend. Philex Petroleum’s subsidiary Forum Energy Plc owns a 70-percent stake in the resource-rich, 8,800-square-kilometer SC 72 in Northwest Palawan.

Del Rosario said Phinma is hopeful of concluding the transaction this year.

“We already put up the petroleum subsidiary. For the transfer of service contracts, we already have a petition to the Department of Energy,” Viray said.