Tuesday, December 21, 2010

Alsons Consolidated acquires stake in Indophil

By Amy R. Remo
Philippine Daily Inquirer
First Posted 11:43:00 12/21/2010

Filed Under: business, Mining and quarrying, Stock Activity

MANILA, Philippines – The Alcantara-led Alsons Consolidated Resources Inc. said Tuesday its board has approved the acquisition of 29.1 million shares in Indophil Resources NL, which owns part of the $5.9-billion Tampakan gold-and-copper project.

In a disclosure to the Philippine Stock Exchange, Alsons Consolidated said its affiliate, Alsons Corp., currently owns the shares, which represent 6 percent of the total ownership of the Australian mining company.

Alsons Consolidated chair Tomas I. Alcantara said the purchase would transfer ownership from the privately held Alsons Corp. to the publicly listed holding company, whose main revenue is currently derived from its power and energy business segment.

“This is part of Alsons Consolidated's plan to increase its revenue share in the future from its other businesses such as mining and property development,” Alcantara added.

The sale of Alsons Corp.'s shares to ACR will be executed via a crossing of the shares off-market in the Australian Stock Exchange.

The purchase of the Indophil shares will also bring an indirect ownership interest for Alsons Consolidated in the Tampakan copper and gold project. It would likewise consolidated its partnership with the Australian miner, which is already a 25 percent partner of ACR Mining Corp. in the Manat gold mining claim in Compostela Valley, currently undergoing advanced exploration work.

Indophil Resources NL is 37.5 percent owner of the Tampakan Copper Gold project in South Cotabato, which is now being developed by XStrata Plc, through its local subsidiary Sagittarius MInes Inc.

According to a mine feasibility update provided by Indophil, the project proponents have recently revised the development cost of the South Cotabato mining project to $5.9 billion from an initial estimate of $5.5 billion.

The new estimate includes the provision of $900 million or roughly P38.7 billion for a planned power plant that will serve the power demand of the Tampakan mining operations.

The Tampakan project is touted to bring in the largest foreign investment into the Philippines as the $5.9-billion investment only pertains to the development cost until the project reaches commercial production. The mine is expected to operate from 2015 to 2033.

Mark Williams, general manager of Xstrata's local subsidiary SMI, earlier said that the Philippine economy would also stand to reap as much as $40 billion within a 25-year period.

Williams had said that the Tampakan project – said to contain one of the biggest untapped copper resources in Southeast Asia – would prove to be an economic driver not only for Mindanao, but for the whole country as well.

Regulator renews Magat hydro power plant license

Manila Times.net

The Energy Regulatory Commission (ERC) has renewed the operating license of the Magat hydroelectric power plant in Isabela. In a statement, the ERC said it has approved the renewal of SN Aboitiz Power Magat Inc.’s (SNAP) certificate of compliance after finding that the company remains compliant with the technical and financial standards of the regulator.

The renewal allows SNAP Magat’s hydroelectric power plant located in Brgy. Aguinaldo in Ramon, Isabela to continue commercial operations for another five years.

SNAP Magat is a joint venture of Aboitiz Power Corp. (AP) and Norway’s Statkraft Norfund Power Invest AS.

The consortium acquired the Magat plant from the government auction block in 2007. The facility is powered by the Magat dam, a multi-purpose water reservoir, which is used to irrigate about 85,000 hectares of agricultural land.

“The ERC is glad that the hydroelectric power plant formerly owned by the government and now run by SNAP Magat remains to be in good operating condition. Renewable energy run plants help the country go clean and green in order to help mitigate the ill-effects of global warming,” Zenaida Cruz-Ducut, ERC chairperson and chief executive, said.

SNAP Magat’s hydro plant has an installed capacity of 360 megawatts. The generation company sells 35 percent of the facility’s power output to five Northern Luzon electric cooperatives through separate bilateral contracts. The rest of SNAP Magat’s generated power is traded in the Wholesale Electricity Spot Market.

Besides operating as a peaking plant, SNAP Magat is also an ancillary service or reserve power provider. It presently has a back-up power agreement with the National Grid Corp. of the Philippines (NGCP), the concessionaire of the National Transmission Corp. that operates the power transmission backbone of the country.

Earlier, Emmanuel Rubio, SN Power chief executive, said the company is studying an increase in the 360-megawatt hydro plant’s capacity by another 90 to 180 megawatts.

Raising the Magat hydro’s capacity, however, hinges on the improvement of transmission facilities that connect to the plant as line constraints may limit how much they can expand.

“We can work our way with NGCP to increase the capacity then 180 megawatts should not be an issue,” Rubio said.

SNAP Magat and the government recently launched a project for the efficient water use in the dam to help secure the productivity of farmlands and fishpond operations despite climate change.

The social collaboration between the National Irrigation Administration, Bureau of Fisheries and Aquatic Resources and SNAP Magat will also teach fisherfolks and farmers regarding scientific water use and agricultural techniques to help them sustain their operations and lessen the impact of water shortage.

AP shares closed at P31.75 apiece, down from its previous close of P32.1.
EUAN PAULO C. AƑONUEVO AND JAMES KONSTANTIN GALVEZ

PetroEnergy gets BOI perks for geothermal power project

By Donnabelle L. Gatdula (The Philippine Star) Updated December 21, 2010 12:00 AM

MANILA, Philippines – PetroEnergy Resourcs Corp. (PERC) has received the package of tax incentives from the Board of Investments as a new renewable energy developer, the company said in a statement.

In particular, the company said it was given perks for its proposed 20-megawatt Maibarara geothermal power project under Republic Act 9513 or the Renewable Energy Act of 2008.

The Maibaba power plant is an integral steamfield and power plant development to be undertaken by Maibaba Geothermal Inc., a joint venture 65 percent owned by PERC’s wholly-owned subsidiary, PetroGreen Energy Corp., and 25 percent and 10 percent owned by Trans-Asia Oil and Energy Development Corp. and PNOC-Renewable Energy Development Corp., respectively.

Earlier, the publicly-listed firm said it would pursue the geothermal power project after securing an environmental compliance certificate from the Department of Environment and Natural Resources (DENR).

The company said it would develop Maibarara, located in Calamba, Laguna and Sto. Tomas, Batangas, and intends to commission the first 20 MW integrated steamfield and power plant by late 2013.

PetroEnergy and its environmental consultant, SMEC Inc., conducted the baseline environmental studies alongside initial consultation with local government units immediately after the DOE award of the Maibarara service contract last Feb. 1.

The environmental examination report was submitted on May 16 and after a series of consultations with the DENR review team, the report was finalized and accepted by DENR-4A last July 8.

The ECC granted by DENR-4A covers the four major phases of the project: well workover and drilling, installation of the fluid collection and reinjection system, power plant construction, and the erection of transmission facilities.

The ECC requires PetroEnergy to, among other conditions, form a multi-partite monitoring program, establish an environmental guaranty fund, and undertake mitigating measures whenever necessary in each phase of the project.

SMC’s brilliant transformation

Manila Times.net
BY TONY LOPEZ




ONE of the most amazing business stories of the first decade of the 21st century is the massive and brilliant transformation of San Miguel Corp.

From a sluggish company with 95 percent of the beer market, San Miguel, founded in 1890, has become a vast conglomerate that is the largest, most diversified, and the most profitable and with stakes in eight new businesses in a big way (power
distribution, oil, power generation, infrastructure, telecom, banking, coal, and mining) on top of four core businesses it had in the past century—beer and beverages, packaging, and property.

In 2000, a year after the FEU-trained engineer Ramon S. Ang took over active management, as vice chairman, San Miguel had sales of just P82.3 billion and income from operations of P7.92 billion. In 2001, sales had leapt 48 percent to P121.58 billion, and income from operations had ballooned 32 percent to P10.48 billion. Ang became concurrent vice chairman, president and chief operating officer in 2002.

In 2009, SMC had sales of P174.2 billion and income from continuing operations of P60.62 billion. Sales nudged up a paltry 3.7 percent from P168 billion in 2008. However, 2009 operating profits exploded by 311 percent or more than four times from P14.67 billion in 2008.

In 2010, San Miguel is expected to chalk up revenues of P232 billion, 33 percent higher than 2009’s P174.2 billion. Operating profits would amount to P30 billion, down 50 percent.

In 2011, expect San Miguel to book the full results of its massive diversification. Revenues would more than double to P500 billion. That’s $11.36 billion at current peso-dollar rate.

Operating profits would be about P60 billion. But profits from companies in which SMC has a significant but not a controlling interest could reach P30 billion to bring total yearly profits to nearly P90 billion.

With revenues of P500 billion and profits of P90 billion, San Miguel would be the largest company in the Philippines, bar none—in both sales and net income.

Ang would have increased SMC revenues six-fold, from P82 billion in 2000 to P500 billion by 2011, and profits more than 11 times, from P7.9 billion in 2000 to P90 billion. By 2011, San Miguel would have owned 90 percent of Petron Corp., the country’s largest oil refining and marketing company, and thus would have reflected its sales of some P260 billion a year. The same year, SMC would also consolidate the revenues from its power plants.

From its three main revenue sources alone—the original four core businesses, Petron and power—SMC will be generating $10 billion to $11 billion annually in sales and $2 billion in operating profits.

Add to that the revenues from other businesses—telco, copper and gold mining, coal, tollways, airports (Clark and Boracay), and mass transit (MRT) and you have a conglomerate whose size and scale cannot be matched by any other group in the country today. If San Miguel can parlay that economy of scale, it will be a very profitable and powerful corporate machine.

Now wonder, since early October, San Miguel’s share price has risen steadily and without letup to reach a record high of P151 yesterday.

At P90-billion annual profits and 2.3-billion shares outstanding, San Miguel is selling at less than three times earnings per share. Assuming 10 times EPS, San Miguel should be worth P380 per share, 2.5 times its current market price. (Note: I don’t own San Miguel stocks).

Ang, vice chairman and president of San Miguel, has captured nearly everything he has set his sight on—90 percent of Petron, the largest petroleum refining and marketing company which has 38 percent of the market; 73 percent of Luzon’s power generating capacity—7,300 megawatts out of 10,000 MW; 37 percent of Meralco, Luzon’s electricity distribution monopoly; management of the country’s two premier new airports—Clark (DMIA) and Caticlan (Boracay); two major expressways linking Manila to eastern northern Luzon and a major mass transit railway line, plus becoming the fourth major wireless telco operator.

Abroad, Ang makes frequent trips by private jet in search of business partners, new projects and businesses, including oil and gas fields, coal mines and other mining properties, in places like Sudan, Iraq, Kazakhstan, Ukraine, Cambodia, China and Russia.

Now that the United States has discovered vast reserves of natural gas, expect San Miguel to join the bidding to develop those energy assets.

“SMC will go where there are opportunities without having to play politics,” he told me in an interview last November. Return on equity from oil and gas fields, he estimates, “can be as high as 50 percent per year.
They are dirt cheap.”

Bna.biznewsasia@gmail.com

Monday, December 20, 2010

Environment agency says coal plant plan to be scrutinized

Sunstar Davao

THE proposed coal-fired power plant by the Aboitiz Power will have to pass through strict scrutiny before it can be constructed, an official of the Department of Environment and Natural Resources (DENR) said Monday.

DENR Regional Executive Director Jim O. Sampulna said the Aboitiz proposed project will undergo an environment impact assessment. "If it will create havoc to the society and environment, then we will not approve it. But we also have to look at it more closely."

But so far, Environment Management Board Regional Technical Director Metodio U. Turbella said Aboitiz Power has not yet submitted any document or application to their office.

Turbella, however, hinted at a preference for coal.

He said that aside from hydro and geothermal sources of energy, coal is a viable and an inexpensive option. "But of course, it will undergo a thorough inspection before we will release any permits."

Meanwhile, the DENR announced it has a new program called the Climate Change Mitigation and Adaptation for 2011-2016. In relation to these, they have prepared a vulnerability assessment and they have finished the following areas: Tagum-Libunganon Watershed, Tamugan-Panigan watersheds, and Dewalwal-Tuganay watersheds. They will soon assess the Lasang and Agusan watersheds.

"We will be providing a complete book of real and documented assessment of our watersheds," said Bonifacio A. Apura, Regional Technical Director for Ecosystem Research and Development Services (ERDS).

Apura also admitted that climate change is a real phenomenon now and that the assessment of these watersheds shall identify what has to be done and to plan the necessary strategies in preparation for the future effects of climate change. (Carmelle Marie Harrow)

Published in the Sun.Star Davao newspaper on December 21, 2010.

Ormoc City is number-one producer of environment-friendly energy sources




ORMOC CITY—Not many people know it, but Ormoc leads in the production of renewable, environmental-friendly fuel. Not only is it the site of the biggest wet steam field in the world; it also has the Philippines’ first ethanol plant in response to the Biofuels Act of 2006.

Eduardo L. Amante, Energy Resources Development and Utilization Division chief of the Energy Department’s Visayas field office, said Leyte Agri Corp. (LAC) inaugurated its ethanol plant in Ipil, this city in 2008. The plant is the first of its kind in the country and produces 20,000 to 27,000 liters of 95-percent ethanol everyday or a capacity to produce 300,000 liters a month.

While production is a far cry from the total Philippine requirement, it is nevertheless good news as it signals that the country is on track in producing its own bioethanol needs. An affiliate of the Philippine Agribusiness Development Corp., the LAC invested P350 million for the facility, P50 million of which went to the distillation equipment.

The plant gets its feedstock from sugarcane from around 56,000 hectares of plantations in Ormoc and neighboring Kananga town. The LAC was off to a good start with a ready buyer in Petron and Flying V.

The LAC, a holding company owned by Julio Sy Jr., isn’t new to the ethanol business as it has been producing food-grade alcohol since 2001. Its facility produces about eight million liters of alcohol annually.

Petron, the country’s largest oil refiner, started procurement of locally-produced ethanol from the LAC which it mixes with fuel sold at the pumps. Petron blends fuel grade ethanol with its E10 premium gasoline, a specially formulated unleaded gasoline that exceeds the requirements of the Biofuels Act.

It contains 10-percent fuel grade ethanol and 90-percent premium unleaded gasoline. This unique and enhanced fuel additive removes existing deposits, resulting to improved power and fuel economy.

The Biofuels Act mandates a five-percent ethanol blend in gasoline by 2009 and 10-percent blend by 2011.

Another larger capacity ethanol plants has followed the footsteps of LAC like San Carlos Bio-energy in Negros Occidental which produces 40 million liters annually. A third plant is La Carlota which also produces 40 million liters yearly.


In Photo: Leyte Agri Corp plant. (Felix Codilla III)

ERC renews compliance certificate of SN Aboitiz Power

BUSINESS MIRROR

MONDAY, 20 DECEMBER 2010 18:21 PAUL ANTHONY A. ISLA / REPORTER

THE Energy Regulatory Commission (ERC) said Monday that it recently renewed the Certificate of Compliance of SN Aboitiz Power Magat Inc. (Snap Magat).

The ERC said the renewal allows Snap Magat’s hydroelectric power plant located in Ramon, Isabela to continue commercial operations for another five years.

Snap Magat’s HEPP has an installed capacity of 360 megawatts (MW) which is powered by the water resources of the Magat River in Ramon, Isabela.

The generation company sells 35 percent of power output to five electric cooperatives (ECs) through a bilateral contract with each of the ECs.

The ERC said the ECs buying power from Snap Magat include Quirino Electric Cooperative Inc. (Quirelco), Isabela II Electric Cooperative Inc. (Iselco II), Cagayan I Electric Cooperative Inc. (Cagelco I), Cagayan II Electric Cooperative Inc. (Cagelco II) and Ifugao Electric Cooperative Inc. (Ifelco).

The rest of Snap Magat’s generated power is traded in the Wholesale Electricity Spot Market (Wesm).

Aside from operating as a peaking plant, Snap Magat is also an ancillary service provider. It has an Ancillary Service Procurement Agreement (Aspa) with the National Grid Corp. of the Philippines, the concessionaire of the National Transmission Corp. (Transco) that operates the power transmission backbone of the country.

“The ERC is glad that the hydroelectric power plant formerly owned by the government and now run by Snap Magat remains to be in good operating condition.

Renewable-energy run plants help the country go clean and green in order to help mitigate the ill-effects of global warming,” Zenaida Cruz-Ducut, ERC chairperson, said.

Agus 6 hydroelectric power plant to be upgraded

By BenCyrus G. Ellorin | Monday| December 20, 2010

CAGAYAN DE ORO CITY (MindaNews/19 December) – The aging Agus 6 hydroelectric power plant in Iligan City, commissioned in 1953, will
get an additional lifespan of 30 years as the Regional Development Council (RDC) of Northern Mindanao approved its P2.6-billion uprating.

Aside from the extended lifespan of Agus 6’s Units 1 and 2 , the uprating project will increase the plant’s capacity from 50 megawatts (mw) to 62. The dependable capacity of the plant will then be increased to 35 mw from the current 25 mw.

The upgrading had long been proposed and was in fact approved by the Investment Coordinating Committee (ICC) of the National Economic
Development Authority (NEDA) in 2006 but implementation of the project has been delayed due to bidding process problems.

Iligan City mayor Lawrence L. Cruz, concurrent RDC chair, said the uprating of Agus 6 is part of the contingency measures to mitigate the
impact of power shortage in Mindanao.

NEDA 10 Dir. Leon M. Dacanay, Jr. said the uprating will be funded from the internal cash generation of the National Power Corporation.
He said this is one of the top priority projects in the 2004-2010 Regional Development Plan of Northern Mindanao.

Power shortage in Mindanao has greatly affected its economic growth, he said. No new baseload power plant has been approved for construction in the last 15 years. With an average economic growth of 4.5 percent in terms of Gross Domestic Product (GDP), power supply in the island has been going haywire.

Current power reserves of seven percent is below the threshold of 13 percent and mechanical issues in the aging hydro electric power plants
have plunged the island in darkness especially during the summer months this year.

Despite poor power supply, power users in the island have suffered sky rocketing power rates as the Mindanao grid was fed with expensive
power from diesel power plants like the power barges on Therma Marine, Inc. in Maco Compostela Valley and Nasipit, Agusan del Norte.
(BenCyrus G. Ellorin/MindaNews)

Sunday, December 19, 2010

Start of WESM in Mindanao expected to take some time

Business World Online

Posted on 11:07 PM, December 19, 2010

THE WHOLESALE Electricity Spot Market (WESM) may finally start commercial operations in the Visayas this Dec. 26, but it will take some more time to establish the market in Mindanao, the head of the Energy department told reporters late last week.

Much depends on how fast Mindanao can build up capacity, Energy Secretary Jose Rene D. Almendras said. "There should be enough reserves," he stressed.

Mindanao, which had suffered a crippling power deficiency amid the dry spell that lasted the first half, still has unstable power reserves. A check with the National Grid Corporation of the Philippines showed the entire island had 204 megawatts (MW) in reserve yesterday -- Sunday has low power demand -- but this is expected to dip to about 122 MW today.

Mr. Almendras said much depends on the coal-fired power plants that have been lined up for the island. He had said there will be 300 MW-400 MW of coal fired capacity in Mindanao by 2014.

Both the government and business sectors have cited the need to wean Mindanao away from hydroelectric power, on which the island depends for more than half of its electricity needs but which had been hit by the dry spell in the first half.

"Maybe, when the coal-fired plants enter [sic], we can shift the baseload of hydroelectricity to ancillary so there is ancillary power. We may start WESM when these coal plants come in," said Mr. Almendras.

He added that the department is also considering variants of the spot market for Mindanao. "We don’t think we can implement WESM in its full form in Mindanao, so we’re trying to pick what is needed to establish a semi-dynamic spot market in Mindanao. It can be supply bidding or nomination format, we’re studying all sorts." -- ENJD

Agusan del Norte, Aboitiz firm cooperate on the environment

Business World Online

Posted on 11:06 PM, December 19, 2010

CAGAYAN DE ORO CITY -- Aboitiz Power Corp. and the Provincial Environment and Natural Resources Office of Agusan del Norte recently signed a memorandum of agreement to undertake various projects to mitigate the effects of climate change, a company statement read.

As part of this cooperation, Aboitiz Foundation -- the group’s social responsibility arm -- has started tree-planting activities in Barangay Amontay in the town of Nasipit, a project the company said it will replicate in other parts of the country.

Besides this environment conservation thrust, the company has also been engaged in community support in areas its units operate.

Therma Marine, Inc., a wholly owned subsidiary of Aboitiz Power that operates a 100-megawatt power barge in Nasipit, awarded grants to 15 high school students in the town during the launch of Aboitiz Power’s corporate social responsibility program in the province earlier this month. The grant covers school expenses of qualified students until graduation. From the 15, at least 10 will be selected for college scholarship, the company said.

In that same event, Aboitiz Power also donated computers to the Nasipit National Vocational School.

Besides Therma Marine’s two power barges (the other one now based in Compostela Valley), Aboitiz Power also runs major power plants in other parts of the country, including the Ambuklao-Binga hydroelectric complex in Benguet, the Magat plant in Isabela and the mini-hydroelectric plants operated by Hedcor, Inc. It also owns distribution utilities like Visayan Electric Co. and Davao Light & Power Co. Aboitiz Power also plans to build a 200-megawatt coal-fired power plant project in Davao City. -- LGD

Napocor needs P39.5B for Spug projects

Raising funds a big problem due to DOJ opinion

By Amy R. Remo
Philippine Daily Inquirer
First Posted 22:20:00 12/19/2010

MANILA, Philippines—State-run National Power Corp. said it needed as much as P39.5 billion to fund its electrification projects in remote and off-grid areas over the next five years.

According to Napocor president Froilan A. Tampinco, the amount will be used to put up new power facilities under the agency’s small power utilities group (SPUG), on top of maintaining the existing facilities that the power firm had earlier put up in these far-flung areas.

Napocor, through its SPUG, is mandated to provide electricity to remote islands and far-flung, inland barangays that are not connected to any of the main grids.

Tampinco admitted that Napocor was finding it difficult to raise funds after it had been barred, through a Department of Justice opinion, from incurring further borrowings and issuances. Napocor’s capacity to provide advances, he added, had also been largely diminished with the privatization of its power-generating plants and contracted capacities.

Napocor now has to rely on marginal revenue from remaining customer sales, government subsidies and the universal charge for missionary electrification, which is being imposed on all power consumers.

Currently, Napocor is asking the Energy Regulatory Commission to reconsider its order and increase to P13.9 billion the approved subsidy for the SPUG, from the P2.76 billion it approved earlier.

However, once approved, electricity bills are expected to increase again as the subsidy will hike the so-called universal charge on missionary electrification (UCME) component to 22.89 centavos per kilowatt-hour.

To further fast-track these missionary electrification projects, Tampinco said Napocor was also offering to prospective investors such projects.

According to Tampinco, the government expects local and foreign investors to pour in as much as P11 billion in fresh investments over the next three years, to put up power projects and other critical energy infrastructure in the far-flung and off-grid areas.

Tampinco said investors were expected to infuse equity into power projects while the state power firm would provide the expertise, and marketing and other services.

Napocor had signed seven agreements with both local and foreign companies for the conduct of feasibility studies in the remote rural areas under SPUG.

In particular, Napocor and the prospective investors are initially eyeing hydropower projects in Oriental Mindoro; natural gas projects in Occidental, Mindoro; and biomass facilities in Lubang, Ticao, Romblon, Kabugao and Batanes.

Meralco seeks ERC approval of contract with BacaValley

By Amy R. Remo
Philippine Daily Inquirer
First Posted 22:16:00 12/19/2010

MANILA, Philippines—Manila Electric Co., the country’s biggest power distributor, has sought government approval of its power-supply contract with BacaValley Energy Inc.

Meralco said the agreement would help protect its customers from the volatile power prices at the wholesale electricity spot market (WESM).

“It must be emphasized that the contract for the supply of electricity (CSE), aside from allowing applicant Meralco to take clean energy at lower cost, offers certain benefits to its customers. For one, it will reduce the dependence of Meralco in sourcing its power requirements from the WESM, thereby protecting its customers from the price volatility in the WESM,” the two companies said in a filing with the Energy Regulatory Commission.

Bacavalley Energy operates the San Pedro Methane power plant, which is fueled by methane extracted from the San Pedro landfill.

According to Meralco COO Oscar Reyes, the agreement will allow the distribution utility to purchase all the power to be generated by the power facility.

BacaValley can produce 4 megawatts, Reyes said in a text message to the Inquirer.

Reyes added that once approved by the regulator, this agreement between Meralco and Bacavalley would be the second involving electricity from a methane facility—the first being the Montalban methane power plant, which supplies 11 MW to the power distributor.

Meralco and Bacavalley signed the contract last month under a take-and-pay arrangement, under which the buyer has to accept all deliveries by the seller.

On top of the immediate benefits to Meralco customers, the CSE is also seen to encourage and stimulate the development of renewable energy sources in the country.

Lopez unit puts up big solar facility

By Amy R. Remo
Philippine Daily Inquirer
First Posted 21:56:00 12/19/2010

MANILA, Philippines—Lopez-led First Philec Solar Corp. has put up the country’s first rooftop-installed solar facility of “utility scale,” a significant proof of the viability of solar energy in the country.

According to the Philippine Solar Power Association (PSPA), the opening of the facility demonstrated how solar electricity could be easily deployed within a few months’ time. It also showed the adaptability of solar plants to grid conditions and how solar energy could be used for industrial and residential purposes.

The PSPA claimed that this was the first solar facility installed in a rooftop that could generate at a so-called utility scale, meaning 100 kilowatts (kW) and above. Similar facilities have earlier been installed on rooftops, but these were mainly used for rural electrification in Mindanao, which meant that the capacities were below 1 kW, explained PSPA president Tetchi Cruz-Capellan.

For household use, such solar facilities could only generate roughly 10 kW, she added.

Located within the First Philippine Industrial Park in Tanauan, Batangas, the First Philec solar facility could generate 180 kW in additional grid capacity.

JPE backs bid to tap BNPP; pushes power initiatives

BUSINESS MIRROR



SENATE President Juan Ponce Enrile has backed a congressional clamor to harness the mothballed Bataan Nuclear Power Plant in the face of an expected energy-capacity shortfall.

“I am in favor of it,” Enrile told reporters after at least 153 congressmen signed a resolution asking the Aquino government to revive the P2-billion idled nuke plant in Morong, Bataan.

Enrile disclosed that he is even hosting a meeting with the head of the State Grid Corp. of China (SGCC), Mr. Liu Zhenya, who is visiting the country next month, to learn more about other possible alternative power sources that the Philippines could tap to plug the anticipated power-supply gap.

The SGCC is part of the Razon-led Monte Oro Grid Consortium that won the 25-year contract to run the National Transmission Corp. after submitting a $3.95-billion bid in an auction conducted by the Power Sector Assets and Liabilities Mananagement Corp. for the Philippine power grid last December 12, 2007.

“I am going to host lunch for Mr. Liu and from him we should learn, because he is a knowledgeable person about power,” the Senate chief said.

Enrile explained, for instance, that China has the biggest hydroelectric power system in the world. “They have the huge dam construction in the Himalayan mountains. They are anticipating the future and they are now going to construct many nuclear plants. Why? Because fossil fuel is not infinite, it is a finite material and sometime in the future this will be gone.”

At the same time, Enrile predicted that coal, which is still used in a number of National Power Corp.’s generating plants, “will be very expensive.”

He added, “fossil fuel, like diesel, crude, bunker would be very expensive. The only thing that will be cheap will be water which comes every time we have the rains. In the temperate countries they have the snow caps that will melt.”

He pointed out that in most advanced countries, “their governments want their people to be assured of a better life so they are going to construct more nuclear plants.”

“But in our case, we are afraid. The environmentalists ask: where are you going to stockpile the fuel and spent fuel? If other countries can do it, why can we not do the same thing?” the Senate President asked.

JPE backs bid to tap BNPP; pushes power initiatives

BUSINESS MIRROR SUNDAY, 19 DECEMBER 2010 21:20 BUTCH FERNANDEZ / REPORTER

SENATE President Juan Ponce Enrile has backed a congressional clamor to harness the mothballed Bataan Nuclear Power Plant in the face of an expected energy-capacity shortfall.

“I am in favor of it,” Enrile told reporters after at least 153 congressmen signed a resolution asking the Aquino government to revive the P2-billion idled nuke plant in Morong, Bataan.

Enrile disclosed that he is even hosting a meeting with the head of the State Grid Corp. of China (SGCC), Mr. Liu Zhenya, who is visiting the country next month, to learn more about other possible alternative power sources that the Philippines could tap to plug the anticipated power-supply gap.

The SGCC is part of the Razon-led Monte Oro Grid Consortium that won the 25-year contract to run the National Transmission Corp. after submitting a $3.95-billion bid in an auction conducted by the Power Sector Assets and Liabilities Mananagement Corp. for the Philippine power grid last December 12, 2007.

“I am going to host lunch for Mr. Liu and from him we should learn, because he is a knowledgeable person about power,” the Senate chief said.

Enrile explained, for instance, that China has the biggest hydroelectric power system in the world. “They have the huge dam construction in the Himalayan mountains. They are anticipating the future and they are now going to construct many nuclear plants. Why? Because fossil fuel is not infinite, it is a finite material and sometime in the future this will be gone.”

At the same time, Enrile predicted that coal, which is still used in a number of National Power Corp.’s generating plants, “will be very expensive.”

He added, “fossil fuel, like diesel, crude, bunker would be very expensive. The only thing that will be cheap will be water which comes every time we have the rains. In the temperate countries they have the snow caps that will melt.”

He pointed out that in most advanced countries, “their governments want their people to be assured of a better life so they are going to construct more nuclear plants.”

“But in our case, we are afraid. The environmentalists ask: where are you going to stockpile the fuel and spent fuel? If other countries can do it, why can we not do the same thing?” the Senate President asked.

Albay residents suffer 400% power-rate increase in Nov.

BUSINESS MIRROR

SUNDAY, 19 DECEMBER 2010 20:09 MANLY M. UGALDE / CORRESPONDENT

LEGAZPI CITY—Residents in Albay province rallied on Friday against the poor power service and high power rate in the province, even as bankrupt Albay Electric Cooperative (Aleco) increased its bill by almost 400 percent in November.

The rally led by the Diocese of Legazpi Social Action Center was held infront of the Aleco office here on Friday, condemning Aleco’s continuing mismanagement and corruption that makes the power cooperative a virtually milking cow at the expense of its 250,000 consumers.

The Albay Consumers’ Watch said the disturbing billing for November was almost equivalent to a 400-percent increase inserted in the billing receipt under the “automatic generation cost.”

Earlier, Albay Gov. Joey Sarte Salceda asked for a power rate increase in Aleco equivalent to P1.66 per kilowatt in what he called would save Aleco from future disconnection. The move, however, was strongly protested by the Church, the militant group, and the business community, including the six Albay Congressmen.

Salceda’s proposal came following a disconnection threat in September from the Philippine Electricity Market Corp. due to Aleco’s unpaid P982 million in outstanding power supply.

Today, Salceda said, the total loan obligations of Aleco including from power sector assets and liability management has shoot up to almost P3 billion from P2.2 billion a few months back. Salceda is touted as the father of the Aleco board of directors.

Asked to comment on Aleco’s current billing, Salceda said he would only meddle in the affairs of Aleco when there is another disconnection notice.

Salceda had succeeded in averting the disconnection threat after he asked President Benigno Aquino III for help.

First District Albay Congressman Edcel Lagman said that Salceda’s power rate proposal was outright rejected by the Department of Energy. Last month, the Diocese of Legazpi headed by Bishop Joel Baylon, Energy Secretary Jose Rene Almendras, National Electrification Adminisration (NEA) administrator Edith Bueno and the Albay congressmen met in Legazpi City to save dying Aleco.

The meeting resulted in the proposal to create the Aleco crisis Committee to be headed by Bishop Baylon, said Ako-Bicol party-list Rep. Rodel Batocabe.

The Crisis Committee would remove the Aleco board in the management, making them a virtual consultative body, Batocabe said.

Pending final approval of the Crisis Committee, the multisectoral groups are asking for the head of Aleco general manager Alex Realoza.

Realoza said his removal would depend on the decision of the board. He defended his stay. He even lashed at the management of the NEA during its almost 20 years control of the cooperative in their rehabilitation efforts. He also cited the previous management of Aleco by a church officials saying the NEA and church officials’ control of Aleco did not also show signs of rehabilitation.

In August, Albay Congressman Al Francis Bichara delivered his privileged speech in Congress denouncing Aleco’s management and corruption. He asked for a congressional inquiry.

But the Albay Consumer’s Watch lamented the much-awaited congressional inquiry has yet to be calendared.

Saturday, December 18, 2010

First Gen to borrow $100m

Manila Standard Today

First Gen Corp., the power generation unit of the Lopez Group, signed Friday a $100-million note issue with Banco de Oro Unibank Inc. to fund its investment program and other operations next year.

First Gen said in a disclosure to the Philippine Stock Exchange that BDO Capital and Investment Corp. would act as arranger of the bonds.

First Gen is selling six- and seven-year bonds with a grace period for the principal payment of 24 months 36 months, respectively.

First Gen officials earlier said the company planned to issue preferred shares worth P5 billion to P7 billion in the first quarter to finance acquisitions and other potential investments.

First Gen president Francis Giles Puno said First Gen was raising funds to partially fund its acquisition of the BG Group’s 40 percent stake in the 1,000-megawatt Sta. Rita and 500-MW San Lorenzo gas-fired power plants.

Meanwhile, its unit Energy Development Corp. said it was in talks with financial advisors for funding options, including a “potential” bond sale. Alena Mae S. Flores