Meralco interested in Mindanao power plant

Danessa Rivera (The Philippine Star) - November 5, 2018 - 12:00am
https://www.philstar.com/business/2018/11/05/1865868/meralco-interested-mindanao-power-plant

MANILA, Philippines — Manila Electric Co. (Meralco) is interested in the Mindanao coal-fired power plant which AC Energy Inc. is selling part of its stake, according to its top official.

Meralco will look at the possible investment in the power plant of AC Energy in Lanao del Norte, chairman Manuel V. Pangilinan said.

The power asset is interesting for Meralco since it is almost completed, which could potentially add to the existing portfolio of its power generating subsidiary, Meralco Powergen Corp. (MGen).

“What I am told it is a coal project…it seems to be almost finished, so ready for operation. So it looks interesting because we don’t have to wait for all sorts of approval. We’ll probably take a serious look at it,” Pangilinan said.

The power plant being referred to is the 4x135-megawatt (MW) coal-fired power plant in Kauswagan, Lanao del Norte in Mindanao through GN Power Kauswagan Ltd. Co. (GNPK).

GNPK is a limited partnership among AC Energy, the Philippine Investment Alliance for Infrastructure, and Power Partners Ltd. Co.

The first unit of the power plant was originally targeted to start operating in the second half of this year.

GNPK plant was previously offered to San Miguel Corp., according to its president and COO Ramon Ang.

Meanwhile, Pangilinan said Mindanao still needs additional power supply from new power plants since some areas are still reeling from power outages.

“What is the demand profile and supply in Mindanao? I don’t know, I can’t say. But my impression is that it continues to suffer from brownouts, so some people said,” Pangilinan said.

Global Business Power Corp., another company which Pangilinan chairs, owns Mindanao coal-fired power plants through its 50-percent stake in Mindanao-based Alsons Thermal Energy Corp., a subsidiary of Alsons Consolidated Resources Inc. (ACR), the listed holding firm of the Alcantara Group.

ATEC holds a 75 percent stake in the 210-MW Sarangani Energy Corp. baseload coal-fired plant in Maasim, Sarangani Province and a 100 percent equity in San Ramon Power Inc. which is developing a 105-MW baseload coal-fired plant in Zamboanga City.

The Ayala power unit is selling up to half of its interest in its thermal energy platform valued at $2 billion to bankroll its regional expansion.

Of its thermal platform, AC Energy has sold part of its stake in a 2x316-MW coal fired-power plant under GNPower Mariveles and a 2x668-MW supercritical coal-fired power plant under GNPower Dinginin to Aboitiz Power Corp. for $579.2 million (roughly P31 billion), subject to the approval of the Philippine Competition Commission.

With the agreement, AboitizPower will increase its beneficial ownership in the Mariveles Project from 66.1 percent to 78.33 percent, and in the Dinginin Project from 40 percent to 70 percent.

This leaves AC Energy with approximately 28 percent in both GNPower plants, broken down into eight percent in the Mariveles plant and roughly 20 percent in the Dinginin plant.

With the investments in the Mariveles and Dinginin projects, the Aboitiz power unit will have its hands full and will no longer take a look at the other coal plants of AC Energy, AboitizPower COO Emmanuel Rubio said.

“We are interested only in GNPower [Mariveles and Dinginin]. We have coal plants in Mindanao and in Luzon, so we’ll just focus on GNPower [Mariveles and Dinginin],” he said.

The Ayala power firm still has its interest intact in GNPK and in South Luzon Thermal Energy Corp., which is a 2x122-MW coal-fired power plant in Batangas co-owned with Phinma Energy Corp.