First Gen unit borrows $265 million for gas-fired plant

Business Mirror
11 Jul 2014 Written by Lenie Lectura

FIRST NatGas Power Corp. (FNPC), a subsidiary of First Gen Corp. (First-Gen), has obtained a $265-million export credit facility to partly finance the 414-megawatt (MW) San Gabriel natural gas-fired power project.

The loan was inked with KfW IPEX-Bank of Germany (KfW) with a tenor of 13.7 years.

Proceeds of the loan will be used primarily to finance the eligible German and non-German goods and services under the equipment supply contract of the San Gabriel power plant with Siemens AG, the equipment supplier.

First Gen President and COO Francis Giles B. Puno said construction of the power facility is ‘progressing.’ “We need to make sure that the plant is built and commissioned on time as it will provide much-needed additional supply to the Luzon grid in the first half of 2016. Although it is envisioned to run on a mid-merit basis, if needed, it can also run on base load,” Puno said.

Siemens had informed First Gen that by the time the San Gabriel plant turns commercial in March 2016, it will be the most efficient gas-fired power plant in Southeast Asia with an efficiency rate of more than 60 percent.

The San Gabriel plant’s use of the SGT6-8000H technology turbine is the basis of the German firm’s claim.

“Closing this $265 million term loan from KfW of Germany is a testament to the strength and viability of the San Gabriel project. We are certainly proud to again have KfW as an anchor lender as it was for Santa Rita and San Lorenzo, our previous landmark gas power projects.

KfW is solely underwriting this transaction and has been very supportive of First Gen’s strategy to develop cleaner and lower-carbon sources of power generation facilities in the country,” Puno said. San Gabriel project is one of three power facilities that First Gen is developing in Batangas City totaling 1,350 MW. “We have started pre-development activities for future units that will enable us to accelerate their development and provide additional capacity to the Luzon grid in 2017 due to its tight supply situation. This will also be dependent on the availability of additional natural gas from the Malampaya field before imported liquefied natural gas can possibly be delivered in the 2019 or 2020 timeframe,” Puno said.

First Gen is a leading Philippine power generation company primarily focused on indigenous, clean and renewable fuels. With a capacity of 2,763 MW, it accounts for approximately 25 percent of total installed capacity in the country today.

In addition to the Santa Rita and San Lorenzo power facilities, First Gen is pioneering the development of additional gas-fired power plants, as well as a liquefied natural gas import and regasification terminal facility. It also owns two hydroelectric power plants with a combined capacity of 132 MW.

First Gen, likewise, owns a controlling stake in Energy Development Corp. (EDC), the largest supplier of geothermal energy in the Philippines. EDC is also developing a 150 MW wind farm in Burgos, Ilocos Norte, which is scheduled to begin operations this year. source