4 ASIAN FIRMS EYE PNOC STAKE IN MALAMPAYA

MANILA, September 2, 2003  (STAR) By Donnabelle L. Gatdula  - PNOC-Exploration Corp. (EC) has received favorable response from at least four Asian ccompanies during the first leg of an international roadshow in preparation for the strategic sale of the shares of stocks of its subsidiary PNOC-Malampaya Production Corp.

PNOC president Thelmo Cunanan said the firms that have signified interest include Pertamina of Indonesia, Thai National Oil of Thailand and two more oil companies from Japan and Korea.

EC is the gas and oil exploration firm of state-owned Philippine National Oil Co. (PNOC).

EC president Rufino Bomasang said the results of the roadshow would determine what privatization mode will be used to dispose of a 49-percent stake in PMPC, which owns a 10- percent interest in the $4.5-billion Malampaya deep water gas-to-power project.

"The objective of this roadshow is to get the interest of foreign firms engaged in upstream exploration activities in the proposed strategic sale of our stake in EC. We have not decided yet on what mode of sale we will choose," Bomasang said.

Cunanan said the financial advisor for the privatization will evaluate the results of the international roadshow and will determine if they will push through with a strategic sale, an initial public offering (IPO) or a deferral of the planned privatization altogether.

"Considering that four major oil firms have expressed interest in the offering, it is a good sign," Cunanan said.

Hong Kong-based CLSA, an arm of renowned investment bank Credit Lyonnais, serves as the financial advisor which handles the first phase of the privatization which primarily involved assets valuation. ING Barings, meanwhile, was chosen as EC privatizationís global coordinator for the second phase. ING Barings will recommend the privatization methods to be used and serve as the underwriter for the offering.

"We will see what happens in this exercise. If this will not be successful we will undertake an IPO. If still an IPO is not yet the answer then we might defer it until better times," Bomasang added.

The sale of 49 percent of PMPC is valued at about $300 million. The remaining 51 percent will still be owned by EC.

The national government wants to privatize ECís 10- percent stake in Malampaya to help bridge its budget gap which is expected to hit more than P200 billion this year.


Reported by: Sol Jose Vanzi

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