Posted on December 21, 2014 09:52:00 PM [ BusinessWorld Online ]
By Claire-Ann M. C. Feliciano, Senior Reporter
EASTERN Petroleum Corp. plans to spend P1.5 billion in the next three years for its maiden venture into real estate development, the company’s chief executive said.
The company will be developing a 150-hectare (ha) site in Buenavista, Agusan del Norte, according to Eastern Petroleum Chief Executive Officer Fernando L. Martinez.
“The estimate development cost for the 150-ha estate is P1.5 billion in three years,” Mr. Martinez said in a phone interview last week.
The official said Eastern Petroleum plans to convert the land into a mixed-use estate that will be developed in three phases.
“We are still finalizing the master plan but we’re looking at the first quarter of 2015 for the initial site development,” he said.
“The first phase of development will be ready by year 2016.”
The estate will have an information technology (IT) site, as well as commercial, industrial and residential components, Mr. Martinez said.
Eastern Petroleum also looks to expand the site by acquiring more land.
“It can still be expanded to 500 ha,” Mr. Martinez said.
The planned mixed-use development is located near Butuan City, providing jobs to residents there.
Eastern Petroleum has set a P1-billion budget for capital expenditures (capex) next year, higher than this year’s actual spending of P550 million.
Of that capex, P250 million will go to the initial development of its property venture.
Some P500 million will be allotted to building its 23.5-megawatt biomass project in Agusan del Norte. The plant is slated for commercial operations by the end of 2016.
The remaining P250 million will go to the expansion of Eastern Petroleum’s fuel distribution network and liquefied petroleum gas (LPG) business.
The company plans to add 50 service stations and 150 distribution outlets by the end of next year. It currently operates 35 stations and 100 LPG distribution outlets across the country.