Oct 2015 Financial News

TTNGL offer a success says NGC chairman

Oct 27, 2015

The T&T National Gas Ltd (TTNGL) has traded $200,000,000 worth of shares in just one week after the launch of its Initial Public Offering (IPO) on October 19.

The IPO, which was launched at a price of $20 per share, is considered to be the largest in T&T’s history. It was traded in a new sector titled the Energy Sector on the first tier market.

Describing yesterday’s official launch, as “momentous,” National Gas Company chairman Gerry Brooks said the IPO was oversubscribed by 1.77 times when the shares were offered for sale and that there was an 25 per cent appreciation on the offer price. The official launch was held at the stock exchange headquarters at Nicholas Towers on Independence Square in Port-of-Spain.

Brooks said: “We firmly believe that one of the main reasons for the oversubscription of these shares was the confidence that the public expressed in TTNGL’s primary asset, its 39 per cent shareholding in Phoenix Park Gas Processors Ltd. PPGPL was a key driver in the attractiveness of TTNGL.”

The launch of TTNGL’s IPO was delayed as a result of issues surrounding the First Citizens IPO in 2013. The issues related to former First Citizens chief risk officer Hassan Philip Rahaman selling 634,588 of the 659,588 shares he purchased in the bank’s IPO. Securities Exchange Commission launched a probe. The SEC’s probe was one of three launched into the First Citizens IPO. The others were the bank’s internal audit and a forensic audit that PricewaterhouseCoopers (PWC) was commissioned to do by then Finance Minister Larry Howai.

Concerning the financial stability of the company, Brooks said it earned operating income of between $150m and $325m for the period 2008 and 2014. Addressing the issue of low energy prices, Brooks said: “The current low price environment, coupled with leaner gas, paints an undesirable picture....The reality is that T&T energy revenue in 2015 and 2016 will be challenged.”

But the future of NGL is bright, Brooks said, and the company is exploring the option of constructing a gas processing facility as one of its growth strategies. “PPGPL is at an important stage in assessing the feasibility of constructing a 300 MMscf/d gas processing facility at Union Industrial Estate to provide gas processing services, thereby participating in the growth of the newest industrial estate in the country.”

Uncertainties in the energy sector is one of the things which the company would have to take into consideration when constructing the gas processing facility, Brooks said.

“Any new plant requires about 36 months. There would be further clarity as the company progresses. That plant does not demand a significant amount of gas. We have to look at the economics of it to see if this makes sense. We have to look at the integrity around the gas supply. We can’t stay as we are the NGC. We have to look at how we are going to change the trajectory of our results for the benefit of the sector.”

He added that the company is looking at its strategic options in the African, as well as the South American, markets: “The possibility of product trading is also on the drawing board as it represents a new direction for the business and an opportunity to expand our marketing research within the region as well.”

“Africa is a greater priority at this stage. We are not ruling out anything as we are in the early stages of our strategic evaluation of our options,” said Brooks, the former chief operating officer at the ANSA McAL.

Brooks, who was appointed to chair NGC earlier this month, said: “NGC is an opportunity to serve the people of T&T for me its an honour and privilege and I hope to use all of the skill, competence, relationships and goodwill for the people of T&T.”

Commenting on the matter which Energy Minister Nicole Olivierre has before the Equal Opportunity Commission accusing the company of racial discrimination, Brooks said the board and the executive of NGC are focused on the business issues facing NGC.

Source:
Nadaleen Singh
Trinidad Guardian
R03;Tuesday October 27, 2015

http://www.guardian.co.tt/business/2015-10-27/ttngl-offer-success-says-ngc-chairman