Gov’t streamlines operations of PNOC
The government has begun the rationalization of the state-run Philippine National Oil Co. (PNOC) to weed out its non-performing assets and subsidiaries.
Energy Secretary Jose Rene D. Almendras said in a briefing that the move was in line with President Aquino’s mandate for government-owned and -controlled corporations (GOCCs) to help the government, instead of being a burden to state finances.
“We’re rationalizing the way the affiliates and subsidiaries operate. We are putting in the financial disciplines—basically to say that if you are not profitable, we will have to privatize you. We want to turn around [losing] companies. We’ve also been rationalizing head count to try and make these subsidiaries more efficient,” Almendras said.
“There has been a lot of structural changes in the GOCCs in the energy portfolio,” he added.
PNOC has five subsidiaries, namely PNOC Exploration Corp., PNOC Shipping and Transport Corp., PNOC Development Management Corp., PNOC Alternative Fuels Corp. and PNOC Renewables Corp.
Of these five subsidiaries, PNOC-EC is the most profitable, having posted a 22-percent growth in its net income to P3.01 billion in 2011, from only P2.48 billion the previous year. It likewise remitted P5 billion in dividends to the national coffer last year.
PNOC-RC is, meanwhile, engaged in several renewable energy projects in partnership with the private sector. One of the more advanced projects it is involved in is the P2.8-billion 20-megawatt geothermal power project with PetroEnergy Resources Corp. and Trans-Asia Oil and Energy Development Corp. This geothermal facility is targeted for commercial operations by late 2013.
According to Almendras, the government wants to make the most of the real estate assets of PNOC-DMC, which is currently managing a 123-hectare property in Rosario, Cavite.
“We don’t want an asset that is not moving. We are looking at possible joint ventures but I cannot disclose details because these are not yet final. The first step is for us to conduct an inventory of the housing developments in Cavite to make sure that there are no idle assets in the portfolio. We already sold some assets in Bohol and in some other places that are not for holding. If it is of no value to us, we might as well dispose it,” Almendras explained.
“It’s about making your assets more financially efficient,” he added.
PNOC-AFC, meanwhile, has abandoned the plan to develop jatropha as a possible biofuel source, so that the remaining funds originally earmarked for jatropha can be diverted to other projects.
Of the P1-billion budget allocated in 2009 for the development of jatropha, only P400 million remains.
PNOC-AFC, however, is engaged in talks with a publicly listed investor group in Dubai, which is looking at the possibility of setting up a refinery or a petroleum facility within an industrial park in Bataan to serve as its hub in the region.
Also, contracts are being prepared to finalize the lease of about 100 hectares of land within the industrial park of PNOC-AFC in Bataan.
The PNOC Shipping and Transport, meanwhile, has been wanting to dispose its assets, starting off with its petroleum tankers, worth a combined P200 million.
