PRIME Infrastructure Capital Inc. (Prime Infra) on Thursday said that it was acquiring 100 percent of Colombian oil and gas company SierraCol Energy Limited from the Carlyle Group, expanding into Latin America as it diversifies from energy and other businesses in the Philippines.
The infrastructure and energy arm of tycoon Enrique Razon Jr. said the transaction, the price of which was not disclosed, was expected to be finalized by next month subject to regulatory approvals.
Prime Infra said the acquisition would expand its participation in the oil and gas sector and support related group businesses.
“We are excited to have acquired SierraCol, the preeminent independent oil and gas company in Colombia, with a portfolio of high-quality assets and a world-class leadership team,” Prime Infra President and CEO Guillaume Lucci said.
“This acquisition strengthens our oil and gas expertise and complements our existing asset base in the Philippines,” he added.
“Together, these capabilities position us to operate across the oil and gas value chain, from upstream to downstream, onshore and offshore and to participate in the sector’s growth against the backdrop of a broader commodities supercycle,” Lucci added.
SierraCol’s asset base includes two giant fields in Colombia, Caño Limón and La Cira Infantas. It is the largest independent oil producer in that country, with gross operated and co-operated production of approximately 77,000 barrels of oil equivalent per day, representing 10 percent of Colombia’s total oil output.
“I would like to thank Carlyle for the support and strategic guidance they have provided over the past five years, which has enabled us to develop SierraCol into the distinctive company it is today,” SierraCol Executive Chairman Tony Hayward said.
“I am also delighted to welcome Prime Infra, a strategic investor who will contribute to the sustainability of the business and provide SierraCol with access to long-term capital,” he added.
Separately, Prime Infra announced on Thursday that it had signed two financing agreements totaling P273.47 billion to support the development of its pumped storage portfolio with a combined two-gigawatt (GW) capacity.
The first is a P214.87-billion project financing agreement with eight banks — Bank of the Philippine Islands, BDO Unibank Inc., China Banking Corp., Land Bank of the Philippines, Metropolitan Bank & Trust Co., Philippine National Bank, Security Bank Corp. and Union Bank of the Philippines — that will be classified as a green loan with the assistance of MUFG Bank Ltd.
The second agreement is a P58.60-billion dual-currency equity standby letter of credit facility with foreign lenders MUFG Bank, Mizuho Bank Ltd., and Sumitomo Mitsui Banking Corp.
Prime Infra said the loans would help finance the ongoing construction of the 1,400-megawatt (MW) Pakil pumped storage hydropower plant of Ahunan Power Inc. in Laguna and the 600-MW Wawa pumped storage hydropower plant of Olympia Violago Water & Power Inc. in Rizal.
Both projects are slated for delivery by 2030 and were part of the Department of Energy’s third Green Energy Auction Program.
“This historic financing reflects the confidence of local and international banks in Prime Infra’s capability to deliver large-scale, critical infrastructure. Our pumped storage hydropower projects demand significant capital, and we are fortunate to have the trust of our banking partners,” Lucci said.
