Published May 9, 2017, 10:00 PM By Myrna M. Velasco
Lopez-owned Energy Development Corporation (EDC) will earmark capital expenditures (capex) of P7.0 billion this year for the “rehabilitation shutdown” of two of its geothermal power facilities in the Visayas to raise their level of operational efficiencies.
In a briefing with reporters following the company’s annual stockholders’ meeting on Monday, EDC President Richard B. Tantoco noted that of the allocation, P3.0 billion will be set for the targeted ‘equipment replacements’ for its Tongonan plant; while P500 million-P600 million will be set for its Palinpinon facility and the balance will be for drilling of geothermal wells as well as for the other components of the assets’ efficiency rehabilitation works.
“That’s our major capex this year – our capex is P7.0 billion. Majority of it will be for Tongonan and drilling,” he said.
The capital outlay, he said, may still change if the company will eventually decide on propounded shutdown also of its modular unit Nasuji – which is part of its Palinpinon 2 geothermal facility.
The scheduled shutdown of the geothermal plants, according to Tantoco, will somehow put a damper on any targets of buoyant income this year – although the overall financial outlook would still be a bit better than 2016.
“Now, our revenues hit P9.6 billion so it’s very strong. But in the coming quarters, we have three plants shutting down for extended periods…our revenues will dampen a little bit and then the spending also will ramp up as we do all of the rehabilitation,” he stressed.
The shutdown of the Tongonan plant will be considerably longer – lasting 110 days; while the Palinpinon facility will be on efficiency rehabilitation downtime for a shorter duration.
The work to be done on Tongonan, he said, will be massive – with programmed “changes in the whole turbines and some of its foundations.”
Following the facility’s workover, Tantoco explained that the positive impact would be on it being able to use less steam for every megawatt of generation.
“Within this year or next year, you’ll see generation getting better. But you will really have everything kicking in on a full-year basis in 2018. This is a transition year with a lot of outages,” Tantoco said.