Gov't seeks PNOC-EC board nod for sale of 60% stake

The government has sought the approval of the board of the PNOC-Exploration Corp. (PNOC-EC) for the sale of its 60 percent stake in the company, Finance Secretary Margarito Teves said at the weekend. Teves said the government needs a separate board approval after it decided to sell a bigger stake in the PNOC-EC from the previous plan of selling just a 40 percent stake in the firm. He said the 60-stake is worth P14-P15 billion, higher than the estimated P11-P12 billion that the state expected to get from the sale of its 40- interest. The PNOC-EC is the upstream oil and gas subsidiary of the state-owned Philippine National Oil Co. Aside from managing the country's oil and power supply, the company also produces and trades coal. The PNOC-EC is a much-coveted asset and analysts said the government could raise as much as P30 billion from the sale of its stake if market conditions are ripe. Teves said the government was still trying to determine the perfect timing of the sale, but it was aiming to dispose of the stocks this quarter. Banking sources said the PNOC-EC board was reluctant to allow the government to sell its stake in the PNOC-EC when market conditions are still uncertain. The government had planned to sell the interest in November 2008, but officials said they were still waiting for better market conditions and for some administrative issues to be ironed out. The government is also selling its Food Terminal, Inc. (FTI) property in Taguig this year for P13 billion after failing to bid it out last year. The government is likewise leasing out a prime property in Fujimi, Japan for around P3 billion. With the adjustments in schedule, the government is now eyeing to raise as much as P30 billion from the privatization of state-owned assets this year from a previous program of P12.5 billion. It expects the budget deficit to widen to P293 billion this year from a previous estimate of P233.4 billion. — GMANews.TV