October 4, 2019 | 12:04 am
A BROWN Co., Inc. said on Thursday
that it had signed a deal to possibly acquire control of a company proposing to
develop a liquefied natural gas (LNG) floating storage and regasification
terminal with a floating power plant in Batangas City.
In a disclosure to the stock
exchange, the Cagayan de Oro City-based company said it had signed a memorandum
of agreement (MoA) with Argo Group Pte. Ltd. “for the possible acquisition” of
approximately 99.995% of the outstanding capital of Vires Energy Corp.
The listed company said the MoA
entered into “is a preliminary agreement and the prospective acquisition will
be concluded after the completion of the customary due diligence period of a
maximum period of 180 days.”
A Brown said Vires, which is owned
by Argo Group, is the proponent of an integrated floating LNG storage and
regasification terminal and a 506-megawatt (MW) natural gas-fired power plant.
The facility is located in Barangay
Simlong, Batangas City. Vires has already secured registration with the Board
of Investments.
Based on data from the Department of
Energy (DoE), Vires had been cleared as early as 2016 to undergo a study that
will assess its power plant project’s impact on the grid, or the country’s
network of interconnected power transmission lines and substations.
Sought to confirm a pending
application for a floating storage and a regasification terminal, the DoE’s Ma.
Laura L. Saguin said in a text message: “As of now, we did not receive any
application from Vires.” Ms. Saguin is chief science research specialist at the
DoE’s natural gas management division.
Aside from its real estate business,
A Brown is also into oil palm nursery and seedlings distribution, palm oil
milling, operation of hotels, real estate brokerage, power generation, and
investment in gold mining assets.
In 2014, it put up Peakpower
Bukidnon, Inc., which has a 15-year build-operate-maintain-and transfer agreement
with the Bukidnon II Electric Cooperative, Inc. The two have a power purchase
and transfer agreement for a 10.40-MW diesel/bunker-fired power plant in Manolo
Fortich, Bukidnon.
A Brown’s disclosure comes after the
DoE on Sept. 20, issued a “notice to proceed” (NTP) to US-based firm,
Excelerate Energy L.P. to develop an LNG floating storage and regasification
unit (FSRU) facility in Batangas province.
The NTP requires Excelerate to
comply within six months with construction permitting requirements, including
the submission of permits from various government agencies and endorsements
from local government units. The company is also required to submit proof of
financial closing to the DoE.
In March, the DoE announced the
signing of an NTP for First Gen Corp., which in December last year signed a
joint development agreement with Tokyo Gas Co., Ltd. to develop an LNG
facility. The Lopez-led company said last month that its immediate focus is to
complete a detailed study on modifications on its existing jetty in Batangas to
allow bringing in an FSRU. — Victor V. Saulon
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