Thai company could join in development of Mabini geothermal project in the Philippines
Under a deal with Basic Energy Corp in the Philippines, Thailand-based VTE could join in development of Mabini geothermal project.
Under a recent deal with Thailand-based Vintage Engineering Public Co. Ltd. (VTE), Basic Energy Corp. will sell shares in a partnership aimed at joint development of renewable energy (RE) projects in the Philippines and abroad, as reported by Phil Star.
In a disclosure to the Philippines Stock Exchange, Basic said it has entered into a subscription agreement with VTE, a publicly-listed company in Thailand, “for a strategic partnership to pursue the exploration, development and production of renewable energy resources, in the Philippines and abroad.”
Both companies initially signed a memorandum of agreement in October 2016 for a strategic partnership wherein VTE’s subscription is equivalent to nine percent of Basic Energy’s outstanding capital stock. Issuance will be done in tranches, pursuant to and subject to the terms and conditions stipulated in the agreement, the local firm said.
“The price is yet to be determined and will be finalized upon the signing of the subscription agreement. There will be two or three tranches,” so Basic Energy senior vice president and general manager Anthony Cuaycong.
Also under the deal, both parties agreed VTE has the right to invest in the Mabini geothermal project and other projects.
“VTE is interested in the gamut of Basic’s projects. Likewise, Basic is in discussion with VTE regarding the latter’s own projects,” Cuaycong said.
The Thai firm may also increase its interest in the company in the future, “both subject to terms and conditions which shall be mutually agreed upon by the parties in the future,” Basic said.
Originally in the business of construction and engineering, VTE has diversified its operations as an engineering, procurement and construction contractor, an operations and management operator.
Basic Energy has five geothermal service contracts, namely the Mabini Geothermal Service Contract (SC) in Batangas, East Mankayan Geothermal Prospect in Ifugao, Mt. Mariveles Geothermal Project in Bataan, Mt. Iriga Geothermal Project in Albay and West Bulusan Geothermal Prospect in Sorsogon.
Among its projects in the pipeline, the Batangas project is the most advanced, with the drilling of an exploratory well currently under way. Basic partnered with Trans-Asia Oil and Energy Development Corp. to develop the resource.
The company is also eyeing to develop two to three RE projects in the near term, particularly solar, for revenue stream while developing geothermal prospects, which has a long gestation period.