PetroEnergy sees 33% more profit on shift to renewables

MANILA, Philippines -  PetroEnergy Resources Corp. (PERC) expects its profit to grow by about 33 percent this year on higher electricity sales as it shifts from oil and gas exploration to renewable energy production, company officials said yesterday.

The company’s performance from January to June has provided a positive glimpse into the company’s full-year results, PetroEnergy president Milagros Reyes said in her report during their stockholders’ meeting yesterday.

“Our forecast is upbeat for 2017 since our first-half financial performance already show a marked improvement in revenues and net income compared to the same period last year. If this efficiency is maintained, we project a 33 percent increase in our net income at the end of this year,” she said.

PetroEnergy closed 2016 with $5.9 million in net income, a 27 percent jump from the previous year’s $4.6 million.

“In 2016, we saw our venture into the renewable power generation begin to bear fruit,” Reyes said.

She said the company has booked a 179 percent increase in net income from $2.34 million to $6.55 million in the first- half of 2017. Revenues, meanwhile, grew 14 percent from $18.4 million to $16.1 million.

The first-half results were on the back of higher sales from its solar, wind and geothermal assets, PetroEnergy vice president Francisco Delfin Jr. said in an interview.

“Our wind project was able to produce higher capacity in January, February and March compared with the remaining months,” he said.

“In the second quarter, it is the summer period in the Philippines. We normally experience a dip in generation of our wind. However, that was compensated by higher production from our solar project. Our geothermal plant, on the other hand, is baseload so it’s constant,” he added.

Moving forward, the full-year projected growth will still be driven largely by electricity sales from RE operations, Delfin said.

Apart from electricity sales, PetroEnergy AVP for finance Carlota Viray said better oil prices will also help augment the company’s net earnings.

“We are seeing recovery in oil prices. Currently it’s around $50 per barrel compared with the previous years at $35 per barrel,” she said.

PetroEnergy’s renewable energy generation business comprises 85 percent of total revenues while oil and gas component covers the remaining 15 percent.

Maibarara Geothermal power plant (MGPP), located in Sto. Tomas, Batangas, is 65 percent owned by PERC through its wholly-owned subsidiary PetroGreen Energy Corp. (PEGC) in joint venture firm Maibarara Geothermal Inc. (MGI).

Through its subsidiary PEGC, it owns 56 percent of PetroSolar, which owns and operates a 50-megawatt (MW) solar power plant in Tarlac.

It also partly owns the 36-MW Nabas-1 Wind Power Project (NWPP) under PetroWind Energy Inc. (PWEI). Its shareholders include PGEC (40 percent), Thai firm BCPG Public Co. Ltd (40 percent) and EEI Power Corp. (20 percent).