Philippines: PetroEnergy sees 33% more profit on shift to renewables

Philippines: PetroEnergy sees 33% more profit on shift to renewables

PetroEnergy Resources Corp. (PERC) expects its profit to grow by about 33
percent this year on higher electricity sales as it shifts from oil and gas
exploration to renewable energy production, company officials said
yesterday.

The company's performance from January to June has provided a positive
glimpse into the company's full-year results, PetroEnergy president Milagros
Reyes said in her report during their stockholders' meeting yesterday.

"Our forecast is upbeat for 2017 since our first-half financial performance
already show a marked improvement in revenues and net income compared to the
same period last year. If this efficiency is maintained, we project a 33
percent increase in our net income at the end of this year," she said.

PetroEnergy closed 2016 with $5.9 million in net income, a 27 percent jump
from the previous year's $4.6 million.

"In 2016, we saw our venture into the renewable power generation begin to
bear fruit," Reyes said.

She said the company has booked a 179 percent increase in net income from
$2.34 million to $6.55 million in the first- half of 2017. Revenues,
meanwhile, grew 14 percent from $18.4 million to $16.1 million.

The first-half results were on the back of higher sales from its solar, wind
and geothermal assets, PetroEnergy vice president Francisco Delfin Jr. said
in an interview.

"Our wind project was able to produce higher capacity in January, February
and March compared with the remaining months," he said.

"In the second quarter, it is the summer period in the Philippines. We
normally experience a dip in generation of our wind. However, that was
compensated by higher production from our solar project. Our geothermal
plant, on the other hand, is baseload so it's constant," he added.

Moving forward, the full-year projected growth will still be driven largely
by electricity sales from RE operations, Delfin said.

Apart from electricity sales, PetroEnergy AVP for finance Carlota Viray said
better oil prices will also help augment the company's net earnings.

"We are seeing recovery in oil prices. Currently it's around $50 per barrel
compared with the previous years at $35 per barrel," she said.

PetroEnergy's renewable energy generation business comprises 85 percent of
total revenues while oil and gas component covers the remaining 15 percent.

Maibarara Geothermal power plant (MGPP), located in Sto. Tomas, Batangas, is
65 percent owned by PERC through its wholly-owned subsidiary PetroGreen
Energy Corp. (PEGC) in joint venture firm Maibarara Geothermal Inc. (MGI).

Through its subsidiary PEGC, it owns 56 percent of PetroSolar, which owns
and operates a 50-megawatt (MW) solar power plant in Tarlac.

It also partly owns the 36-MW Nabas-1 Wind Power Project (NWPP) under
PetroWind Energy Inc. (PWEI). Its shareholders include PGEC (40 percent),
Thai firm BCPG Public Co. Ltd (40 percent) and EEI Power Corp. (20 percent).

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Link to Original Article:
http://www.philstar.com/business/2017/07/27/1721761/petroenergy-sees-33-more
-profit-shift-renewables

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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com