UTC's
energy fund open to ordinary citizens
By Roxanne Stapleton
Trinidad Express
Port
Spain
Petroleumworldtt.com
12 10 06
ORDINARY
CITIZENS and savvy investor types alike, wanting
a stake in global energy wealth, last week got yet
another access route to acquire such.
The
Unit Trust Corporation launched its energy fund
at its Port of Spain headquarters.
Gayle
Daniel-Worrell, UTC's VP Marketing and International
Business said that investors in the US denominated
fund can start with as little as US$100 which will
be the minimum initial purchase amount required
to open an account.
She
explained further that shares of the fund will be
sold at the offer price and can be redeemed at the
bid price - with the difference between the two
amounting to five per cent, which represents the
initial sales charge.
For
the first two-weeks that the fund is offered to
the public, it will be sold for US$20 each.
The
fund seeks to achieve its investment objective of
capital appreciation by investing in securities
of energy and energy related companies.
It
will seek to invest in these companies through the
purchase of their shares on stock exchanges throughout
the world, wherever they are listed, Daniel-Worrell
commented.
"The
fund will seek to include investment in many of
the companies operating in Trinidad and Tobago such
as BP, BG, BHP Billiton and ConocoPhillips and can
also invest in oil service companies such as Halliburton,"
she noted.
It
also has the flexibility to invest in new energy
projects here and across the region, also encompassing
emerging energy technologies and alternative energy
bases.
Of
its risks, Daniel-Worrell said: "Investments
in this fund are subject to curtain risks. Since
the fund's investments will be concentrated in one
industry, the energy industry, the fund's performance
largely depends, for better or worse on the overall
condition of the energy industry.
"Because
it is denominated in US dollars, it is subject to
currency risks.
"The
fund is also exposed to normal investment and trading
risks, which are risks that prices of securities
held in the portfolio could fluctuate.
"There
are also global investment risks, which are associated
with tax structure changes of regulations in various
countries.
"If
we were to look at the performance of various energy
stock indices, we can see that the Standard and
Poors Global 1200 Energy Sector Index, for example
had a year to date return as at November 27, 2006
of 16.46 per cent - a one year return of 16.18 per
cent.
"The
Energy Select Sector Index had a year to date return
of 15.54 per cent a one-year return of 18.16 per
cent and a five-year return of 132.01 per cent,"
Daniel-Worrell added.
Meanwhile,
it was revealed that the UTC is interested in acquiring
a stake in Mirant's 39 per cent share in Powergen.
Mirant
earlier in the year, announced that it was selling
its Caribbean and Philippines assets to enhance
shareholder value.
UTC
Chairman, Amoy Chang Fong said: "We would be
interested in that," adding that a strategic
investment team is looking into it.
"We
have limitations on the level of the investment
that we can make, in terms of the exposure to any
one company and exposure of the fund size to any
one company.
"I'm
not sure what the status of the prospective sale
is, but 39 will probably fall outside," Chang
Fong said.
Numerous
local enterprises and businessmen have also expressed
interest in investing in the lucrative power generation
company.
UTC
executive director, Michael Alexander, added: "Had
we not been launching the energy fund, we still
would have had an interest in it. The launching
of the energy fund is another opportunity to look
at that and in any case energy related investments
are downstream, upstream, greenfield, across the
board anything that speaks to energy."
Questioned
as to whether the UTC still has an interest in the
Eastern Caribbean Gas Pipeline project (ECGP), Chang
Fong was also forthcoming.
"In
our point of view, if all the targets are met, in
terms of the approvals from proposed participating
countries, we feel that the Eastern Caribbean Gas
Pipeline could be a viable project.
"I
think the issue that was raised earlier this year
had to do with the exposure of various funds of
the UTC to the ECGP.
"As
far as the project goes, the Barbados authorities
have not yet given approval for several things that
need to be dealt with like the importation of gas,
the seabed survey...
"Hopefully
those decisions will come shortly, the ECGP, part
of it could be something the energy fund will have
an interest in," she said.
Trinidad
Express
Wednesday, December 6th 2006
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©2006 Trinidad Express. All Rights Reserved.
