Semirara signs P11.5-B loan with 4 local banks

Manila Times.net
Published : Tuesday, February 28, 2012 00:00 Written by : Euan Paulo C. Añonuevo


SEMIRARA Mining Corp. has tapped four local banks for a syndicated loan to fund the expansion of the Calaca coal plant in Batangas.


In a disclosure to the Philippine Stock Exchange, Semirara said that the company, through wholly-owned unit Southwest Luzon Power Generation Corp., signed a loan agreement with lenders worth P11.5 billion for the 300-megawatt (MW) expansion of the Calaca coal-fired power plant.


The banks include Banco De Oro Unibank Inc., Bank of the Philippines Islands and China Banking Corp. (the lenders) with BDO Capital and Investments Corp. as lead arranger.


Southwest Luzon will use the amount to partially finance the design, engineering, procurement, construction and operation of the Calaca plant.


In return, Semirara agreed to guarantee its subsidiary’s obligations, shoulder cost over runs and pledge 67 percent of voting shares to the lenders. Isidro Consunji, Semirara vice chairman, said they decided to get a lower loan of P11.5 billion from the previously approved P14 billion due to “lower project cost and more equity.” The total project cost of the Calaca’s expansion was placed at $425 million (P18.2 billion).


The Semirara board last year approved the additional investment in power generation for an additional 300 MW capacity alongside the existing 600 MW Calaca plant. The facility is designed to utilize local coal from Semirara.


DMCI Holdings Inc., parent firm of Semirara, bought the Calaca plant from the government in July 2009 with its bid price of $361.7 million.


Semirara is the country’s largest coal producer with production reaching 7.19 million metric tons last year.