PHINMA Energy Corp. said its listed petroleum and geothermal exploration subsidiary had relinquished its participating interest in Service Contract (SC) 6 Block B, a move that was previously approved by the Department of Energy (DoE).
Phinma Energy told the stock exchange that Phinma Petroleum and Geothermal, Inc. (PPG) has given up its 14.063% participating interest in the exploration block. It said the withdrawal was cleared by the DoE on Oct. 30, 2018.
“PPG believes that the remaining prospects in the block are either uneconomic or high risk and, therefore, do not warrant further investments,” Phinma Energy said.
But the company said the unit had retained its 2.475% carried interest in the block or a non-paying interest comparable to a royalty that shares in any production revenues.
It said the retention was meant to ensure that the company would still benefit in the event of any commercial oil production in the area.
Phinma Energy gave up the service contract as it wraps up the sale of the company to the Ayalas’ AC Energy, Inc.
Meanwhile, Phinma Energy said its board of directors had approved the postponement of the company’s annual stockholders’ meeting, which its by-laws say should be held on any business day in April of each year.
The postponement is in line with the investment agreement between Phinma Corp., Phinma, Inc. and AC Energy under the terms of which the Phinma group will sell and transfer to the Ayala Corp. unit all their shares of stock in Phinma Energy constituting a majority of its issued and outstanding shares.
The company said it had been informed that on the closing of the transaction after obtaining approval of the Philippine Competition Commission, a change of management in Phinma Energy would take place.
On Tuesday, shares in Phinma Energy slipped by 1.49% to close at P1.32 each. — Victor V. Saulon
