Basic Energy eyes up to 60% of Filoil Energy

MANILA, Philippines — Listed Basic Energy Corp. (BEC) is eyeing an equity investment of up to 60 percent in independent oil firm Filoil Energy Co. Inc.

In a disclosure to the Philippine Stock Exchange yesterday, BEC said its board approved the proposed equity investment in Filoil Energy.

The planned investment in Filoil comes after the subscription of real estate firm Map 2000 Development Corp. (M2DC) in BEC last May.

M2DC holds 55 percent of independent petroleum retailer Filoil Gas and Energy Co. Inc., which is part of the Villavicencio group of companies.

Last May, BEC executed a subscription agreement with M2DC to subscribe to 9.83 billion primary shares for P2.8 billion, allowing it to secure 67.83 percent of the listed firm.

With the entry of M2DC, BEC’s public float would decrease from 66.54 percent to 21.4 percent, while foreign ownership would decline from 7.44 percent to 2.39 percent.

M2DC—which is primarily engaged in real estate acquisition, development, and management—will use BEC as its entry to the energy sector.

BEC said M2DC’s investment would result in a fresh capital infusion into the company, allowing it to grow and expand its current portfolio of energy-focused projects, including interests in other renewables such as solar, wind, biomass, petroleum and other types of energy projects.

Part of the proceeds will be used for the Mabini Wind Power project and the Iriga Geothermal Energy project.

Last March, BEC secured a wind energy service contract (WESC) through wholly owned unit Mabini Energy Corp. to develop a 50-megawatt (MW) wind farm in Batangas by 2027.

BEC has a 20 percent participation interest in the Iriga Geothermal Project, which is being operated by DESCO Inc. The project currently has an approved work program for the drilling of two wells up to 2022.

Apart from the Iriga project, its other geothermal service contracts include the Mabini Geothermal Service Contract in Batangas, East Mankayan Geothermal Prospect in Ifugao, Mt. Mariveles Geothermal Project in Bataan, and West Bulusan Geothermal Prospect in Sorsogon.

BEC also has a 15 percent equity in Vintage EPC Company and VTE International Construction Co., which are companies registered in Thailand and which are the primary EPC contractors of a 220 MW solar power project in Minbu, Myanmar.