PNOC mulls privatization of shipping subsidiary


Posted at Aug 08 2010 02:32 PM | Updated as of Aug 09 2010 02:39 AM

MANILA, Philippines - State-run Philippine National Oil Company (PNOC) said it may revive plans to undertake an initial public offering of its unit PNOC-Shipping Corp. (PSTC).

Energy Secretary and PNOC chairman Jose Rene Almendras said the public offering of PSTC could be an alternative as the government no longer wants to privatize its Malampaya gas stake in PNOC-Exploration Corp. (PNOC-EC).

"The present decision is Malampaya's not going to be sold. It's not for sale. There are other PNOC subsidiaries that are going to be  offered for sale but not this one, not yet. The small ones, service ones. We are not recommending it because the upside value is very good," Almendras said.

The previous administration wanted to sell government's stake in PNOC-EC to shore up funds and plug a swelling budget deficit.

But Almendras said the new government can rein in the deficit and raise more revenue from a slew of initiatives of the country's main collection agencies.

"The pressure to unload and privatize this particular asset is not as great now and it's not the one that you want to let go considering the amount of resources it's bringing in now as of our last discussion. We're gonna keep it and we're gonna hold it," he said.

Instead, the PNOC board is revisiting previous proposals to privatize the PSTC.

"The board already decided to explore the possibility of letting go of its shipping company. You have to sell the two ships which are single hulled, so rather than just sell the ships, the board opted to, if possible, sell the whole company," he said.

The PNOC is also eyeing the direct sale of assets, particularly its tankers.
PSTC is primarily engaged in the business of shipping, tankering, lighterage, barging, towing, transport, and shipment of goods, chattels, petroleum and other products, marine, and maritime commerce in general.

The company maintains more than 4 tankers, 3 of which are owned and one chartered-in tanker with capacities from 23,000 to 30,000 barrels.

One of PSTC’s clients is Petron Corp., the country’s largest oil refiner and also one of the subsidiaries of PNOC.