Thailand's PTTEP to invest $1.3 billion for Cove Energy over 5 years
BANGKOK (Reuters) - PTT Exploration and Production Pcl PTTE.BK, Thailand's top oil and gas explorer, aims to invest $1.3 billion for the operations of British-based Cove Energy Plc in the next five years after raising $3 billion in the country's biggest equity sale ever.
Cove, which has given PTTEP access to massive gas finds off the coast of east Africa, will play a major role in helping PTTEP achieve its production target and boost petroleum reserves to meet rising demand in the Southeast Asian country.
"From now on, we will use the proceeds from the equity sale and cash flow to finance our investments," PTTEP Chief Executive Tevin Vongvanich told reporters.
Cove owns an 8.5 percent stake in a Mozambique licence in the Rovuma offshore basin containing gas discoveries that could be a major provider of liquefied natural gas (LNG) to energy-hungry Asia.
The Rovuma field is expected to begin operations in 2018 with initial output of 10 million tonnes of LNG, Tevin said.
The Cove budget is part of the company's plan to invest 600 billion baht ($19.6 billion) until 2020, when its output is expected to double to 600,000 barrels of oil equivalent per day (BOEPD).
PTTEP, the flagship unit of the Thailand's top energy firm PTT Pcl PTT.BK, vies with big Chinese oil firms such as CNOOC Ltd (0883.HK) and Sinopec Corp (0386.HK) in securing resources.
This month, the company raised 92.3 billion baht ($3 billion) by offering 650 million shares at 142 baht a piece to existing shareholders, which was oversubscribed by more than two times.
At 0805 GMT, PTTEP shares were down 0.3 percent at 152.50 baht, while the overall index .SETI was 0.4 percent higher.
The sale came amid a boom in fundraising for Southeast Asian equity capital markets, and will help repay a 950 million pound ($1.5 billion) bridging loan it borrowed to finance the acquisition of Cove as well as fund plans to expand aggressively.
The company also aims for 10 percent growth in petroleum output in 2013 from 310,000 BOEPD in 2012, but sales volume this year is seen at 275,000 BOEPD, below its target of 284,000 after delays in the startup of Australia's Montara oil field until February 2013, Tevin said.
PTTEP, which already has five exploration and production projects in Myanmar, is keen to join with other investors to participate in a new round bidding for petroleum concessions in the country, he added.
PTTEP, valued at $19.8 billion and 65 percent owned by state-controlled PTT, said in October it had set a new "achievable" production target of 600,000 BOEPD by 2020, down from a previous target of 900,000 BOEPD.
(Reporting by Khettiya Jittapong and Pisit Changplayngam; Editing by Chris Gallagher)
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