Short-term commercial papers (STCP) amounting to P1.21 billion were reissued by giant oil firm, Phoenix Petroleum (PNX), to finance day-to-day operations and back the company’s prevailing debts.
The STCPs, which were issued on June 16, have a maturity period stretching to 180 days. PNX will have to meet all monetary deadlines by December 13, 2017.
“This is part of our current license with [Securities and Exchange Commission] to issue the same. It will fund day-to-day working capital and augment existing short term bank lines,” company vice president for external affairs Raymond Zorilla said in a text message to The Philippine Star.
For the past two years, the company has been issuing commercial papers totaling to P4.7 billion. Last year, the company allotted P1.21 billion STCPs which matured on July 12, 2016.
The remaining P3.5 billion worth of commercial papers were distributed in 2015. The STCP produced three tranches with maturity periods of 90 days (tranche D), 180 days (tranche E), and 343 days (tranche F).
Commercial papers are short-term debt instruments usually issued by a corporation to finance its accounts and short-term liabilities.
Expansions and contributions
On the other hand, the oil giant has prepared P10 billion as fund for its expansion plans, both internal and external.
P2 billion will be billed for internal expansions, and P6-8 billion will be allotted for external acquisitions ranging from liquefied petroleum gas (LPG) and lubricant businesses to other oil companies.
The ventures have started with PNX’s acquisition of another local oil company, PETRONAS Energy Philippines, and a securities company, Duta Inc. last month.
The company also gave M/V Amazing Grace, the Philippines’s biggest humanitarian vessel, “P25-million worth of fuels lubricants, and technical services.”
