While China remains the dominant investor in acquiring Southeast Asian energy assets, Australia has begun to compete with Chinese dominance. Australia's Otto Energy Ltd. has bought the entire 68.62 percent stake of the Vitol Group in Galoc Production Co.
Galoc Production Co. is the operator of the Galoc oil field off The Philippines' northwestern Palawan Island
Otto Energy Ltd. paid $18.7 million for the Vitol Group's share of the Galoc oil field, The Manila Standard reported. The transaction makes Otto Energy Ltd. the 100 percent owner of Galoc Production, which has a 59.84 percent stake in service contract 14C, up from its original stake of 31.38 percent.
Otto Energy Ltd. acting chief executive Matthew Allen said in a report to the Australian Stock Exchange, "This acquisition represents an attractively priced, low-risk opportunity for Otto to increase its share of revenue from Galoc, as well as to better leverage the expertise within the group through assuming operatorship. Revenue from Galoc continues to provide a valuable source of funds for reinvestment and this is set to grow as we move towards a Phase 2 expansion of the project."
Otto Energy Ltd. will fund its acquisition of Vitol's stake in the Galoc oil field from its existing cash reserves, with the transaction scheduled for completion later this month.
Otto Energy Ltd. officials said that the Company acquisition of Vitol's stake in Galoc Production would hasten the development of the second phase of the oil-producing field in northwest Palawan, which currently produces around 6,800 barrels of oil per day.
By. Charles Kennedy, Deputy Editor OilPrice.com
Charles is a writer for Oilprice.com More