By Myrna M. Velasco
Listed firm Phoenix Petroleum Philippines Inc. has pumped in additional US$12.6 million capital into its oil trading arm in Singapore.
In a disclosure to the Philippine Stock Exchange (PSE), the Uy-led company indicated that its board of directors approved the additional capital outlay for its wholly owned subsidiary PNX Petroleum Singapore Pte. Ltd, “to support the latter’s trading business.”
That subsidiary in the city-state was initially earmarked US$10 million capital last year, primarily to jumpstart its oil trading venture in the Asian regional market.
Then from that jump-off point, the company has incorporated another subsidiary to manage its international expansion – channeled through its PNX Energy International Holdings Pte. Ltd. (PEIH), which is targeting investments in five countries.
“The company is currently exploring investments in regional markets such as Vietnam, Indonesia, Myanmar, Thailand and Australia,” it stated in a document submitted to the stock market.
Phoenix Petroleum emphasized that “as the company expands regionally, it requires an appropriate corporate structure to ensure tax efficiency, a stable or fair legal environment, world class infrastructure and access to high quality international skills.”
It explained that Singapore has been its “preferred location” because of several advantages that the lion state offers, including “excellent financial and information technology infrastructure and pro-business environment.”
The Uy-controlled company further stated that Singapore also has major international air and sea hubs; flexible tax regime designed to support business; transparent and fair legal system as well as various dispute resolution channels; and it has ‘no thin capitalization’ rules.
Phoenix Petroleum emphasized “other than holding shares in other foreign subsidiaries and generating passive investment income, PEIH may also carry out commercial activities,” primarily those that delves with the oil industry’s supply chain.
Just recently, the company signed an off-take agreement for liquefied petroleum gas (LPG) from the Hengyi refinery in Brunei Darussalam. The deal was firmed up via the latter’s Hengyi Industries International Pte. Ltd. (HYII) which is also based in Singapore.