Eastern Petroleum hikes capital

Independent oil player Eastern Petroleum Corp. will increase this year its authorized capital to P1 billion from P500 million to help fund its aggressive retail network expansion and oil depot construction.

According to Eastern Petroleum chairman Fernando L. Martinez, the company has earmarked about P900 million for the construction of about 100 stations and more depots in several key areas this year and in 2013.

Martinez said the company had programmed P500 million for its capital expenditure this year. This covers the setting up of 15 more stations, which will expand its network to 50 stations from 35 as of the end of 2011.

A portion of the budget was earmarked for land acquisitions in General Santos, Cebu and another strategic area in Luzon, which will be used for its oil terminals.

Next year, at least 50 stations are expected to be constructed jointly with prospective franchisees, and would thus need a lower capex budget of about P400 million on the part of Eastern Petroleum.

Martinez said 30 new sites had been identified for the proposed retail gas stations.