Business World Online
Posted on July 13, 2011 09:37:05 PM
ENERGY DEVELOPMENT Corp. (EDC), a geothermal plant operator, will disassemble its 49-megawatt (MW) decommissioned facility in Negros Oriental to make better use of $100 million worth of equipment there, possibly in another site elsewhere in the Visayas region, a ranking official yesterday said.
EDC President and Chief Operating Officer Richard B. Tantoco told reporters that EDC will have to modify its Northern Negros Geothermal Power Plant (NNGP) in Bago City, Negros Oriental and downgrade its operating capacity to five to 10 MW so that it remains profitable.
“Because we are committed to delivering power to the Visayas grid, we shall immediately begin to take steps to right size the power plant in NNGP. The size of the plant turbine must match the amount of steam produced,” Mr. Tantoco said, adding that the impending plant transfer was both possible and likely.
EDC is currently looking at locations in Visayas, but preferably in Negros province as well, Mr. Tantoco said without elaborating.
NNGP is being operated at a cost of P800 million, but only rakes in P300 million in income, a net loss of P300 million, EDC Chief Financial Officer Nestor H. Vasay said in the same briefing.
“At $100 million, NNGP is a very valuable piece of equipment, so it would be foolish for the company to leave the asset to rot,” Mr. Tantoco said.
Mr. Vasay added that NNGP has been running below capacity and has already lost P4.8 billion since its first operation in 2007.
According to EDC, experts from New Zealand and US found problems with the current plant location, citing permeability concerns.
EDC is targeting a 220- to 250-MW expansion within two to five years, without any foreseeable fund-raising activity this year, Mr. Vasay said. -- Franz Jonathan G. de la Fuente
“Because we are committed to delivering power to the Visayas grid, we shall immediately begin to take steps to right size the power plant in NNGP. The size of the plant turbine must match the amount of steam produced,” Mr. Tantoco said, adding that the impending plant transfer was both possible and likely.
EDC is currently looking at locations in Visayas, but preferably in Negros province as well, Mr. Tantoco said without elaborating.
NNGP is being operated at a cost of P800 million, but only rakes in P300 million in income, a net loss of P300 million, EDC Chief Financial Officer Nestor H. Vasay said in the same briefing.
“At $100 million, NNGP is a very valuable piece of equipment, so it would be foolish for the company to leave the asset to rot,” Mr. Tantoco said.
Mr. Vasay added that NNGP has been running below capacity and has already lost P4.8 billion since its first operation in 2007.
According to EDC, experts from New Zealand and US found problems with the current plant location, citing permeability concerns.
EDC is targeting a 220- to 250-MW expansion within two to five years, without any foreseeable fund-raising activity this year, Mr. Vasay said. -- Franz Jonathan G. de la Fuente
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