Mindanao opportunities eyed

Business World Online

Posted on January 29, 2013 10:59:20 PM

THE POWER generation arm of Manila Electric Co. (Meralco) plans to tap opportunities presented by Mindanao’s electricity shortage through its tie-up with a subsidiary of Metropolitan Bank & Trust Co. (Metrobank), a top official of the utility said last Monday evening.

EXHIBIT ATTENDANTS man a booth of Manila Electric Co. during a conference of the semiconductor industry at the SMX Convention Center in Mall of Asia Complex, Pasay City in this file photo taken on June 7 last year. -- JLC

Meralco had announced in a brief disclosure earlier that day a memorandum of understanding between Meralco PowerGen Corp. and Global Business Power Corp. (GBPC) “to jointly pursue and evaluate certain potential power generation projects in the Philippines.”

One of GBPC’s two main stakeholders, First Metro Investment Corp., is a unit of Metrobank, flagship of Ty conglomerate GT Capital Holdings, Inc.
“The agreement… was for certain power generation projects of Global Business in Mindanao which they are looking at developing and giving us the opportunity to partner with them and participate,” Meralco President and Chief Executive Officer Oscar S. Reyes told reporters after the 64^th Management Association of the Philippines Inaugural Meeting in Makati City.

Meralco PowerGen said in a statement yesterday that it expects the deal to be sealed “shortly.”

“It’s going to be four… mainly coal-fired, but also run-of-river,” Mr. Reyes said, when asked how many plants were involved.

Pressed on total planned capacity, he said “some of the projects are around 100 megawatts (MW).”

Mr. Reyes added that these projects will not form part of the original 2,700-MW portfolio planned by his firm which will all be in Luzon.

Should the partnership push through, it will mark both firms’ entry to Mindanao, which has been hounded by power shortage that yesterday was estimated by the National Grid Corporation of the Philippines at 123 MW.

“You see, Meralco is trying to help address the requirement for adequate reliable power… with very fuel-efficient new technology plants with credible partners…” Mr. Reyes said, adding this foray “does not necessarily mean we are entering distribution there.”

GBPC officials were not immediately available for comment.

According to the Philippine Energy Plan 2012-2030 launched by the Department of Energy last month, Mindanao will need an additional 1,600 MW by 2030. As of end-2011, the island had total installed capacity of 2,022 MW.

“For 2013, we need at least 250 MW (additional capacity),” Mylene C. Capongol, director of the Energy department’s Electric Power Industry Management Bureau, said via text yesterday.

Shares of Meralco gained P4.80 or 1.63% to close at P299 apiece yesterday from a P294.20 finish last Monday, those of GT Capital added P11 or P1.65% to P679 from P668, while those of Metrobank shed P1 or 0.93% to P106 each from P107.

Beacon Electric Asset Holdings, Inc., which has the biggest stake in Meralco, is partly owned by the Philippine Long Distance Telephone Co (PLDT). Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a minority stake in BusinessWorld. -- Emilia Narni J. David and Claire-Ann Marie C. Feliciano    source