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Posted on 09:19 PM, December 22, 2010

LISTED Trans-Asia Oil and Energy Development Corp.’s decision to sell its royalty stake in Service Contract (SC) 6 or the Cadlao production area has been approved by the Department of Energy (DoE).

THE CADLAO production area in Palawan — www.transasia-energy.com

In a disclosure, Trans-Asia said “the DoE posed no objection to and recognized the assessment by Trans-Asia of its 1.65% overriding royalty interest in SC 6 Cadlao production area to Peak Royalties Ltd.�
The Cadlao production area is in northwest Palawan.

Trans-Asia Oil had signified willingness to sell its royalty stake in the service contract provided the other stakeholders did the same.

Blade Petroleum Ltd. owns 80% of the participating interest in SC 6 while VenturOil Philippines, Inc. owns the remaining 20%. Philodrill Corp. and Philex Mining Corp. hold a 1.65% royalty stake.

The Cadlao area was already producing around 11 million barrels of oil from 1981 to 1991 but operations were suspended in 1990 due to low oil prices.

For the nine-month period that ended September, Trans-Asia posted a net loss of P98.7 million, reversing the net income of P220.6 million in the same period last year.

Revenues dropped by 15% to P732.8 million in the nine-month period from P866 million posted in the previous year.

The drop was attributed to “the cessation of operations of the power generating plant of the CIP II Power Corp. beginning April 11, 2009 when [Manila Electric Co.] took over the concession agreement with the developer of Carmelray Industrial Park II in Calamba, Laguna.�

Shares in Trans-Asia remained at P1.09 apiece at the close of yesterday’s trading. — ENJD

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