EDC plans to spend US$140 million on geothermal work

Alexander Richter 9 Jun 2009

Philippine based Energy Development Corp. (EDC), said it has earmarked P9.61 billion (US$ 203 million) for its capital expenditures (capex) this year, of which about US$ 140 are planned expenditures on geothermal programs within the company.

Reported locally, “Energy Development Corp. (EDC), the Philippines’ biggest producer of geothermal energy, said it has earmarked P9.61 billion (US$ 203 million) for its capital expenditures (capex) this year.

In a report to the Philippine Stock Exchange, EDC said about 70 percent (about US$ 140 million) of the total budget was appropriated for the “the construction of the power plants, fluid collection and re-injection systems [FCRS], transmission lines and for drilling activities of [geothermal] projects.”

The Lopez-led energy firm said these included the 20-megawatt (MW) Nasulo in Southern Negros; 50-MW Tanawon in Albay, and 50-MW Mindanao 3 in Cotabato, among others.

According to EDC, the company has earmarked P2.42 billion for Tanawon (which is expected to start operating commercially by 2012); P1.4 billion for Nasulo (2011); and P2.4 billion for Mindanao 3 (2012) and other projects.

“The budget also includes expenditures amounting to P200 million for the construction of the Northern Negros FCRS for the wells to be drilled near the national park’s buffer zone,” EDC said.

Last month, the EDC board of directors approved to increase the company’s authorized capital stock to P31.15 billion from the current P15.08 billion.

The increase in the company’s authorized capital would consist of an additional 15 billion common shares with a par value of P1 and an additional 7.5 billion preferred shares with a par value of P0.01.

“To fund EDC’s growth, we should not only rely on additional borrowings because debt capital markets can tighten and have tightened in the very recent past,” said EDC president and CEO Paul A. Aquino.

EDC’s existing borrowing capacity is estimated at $600-$800 million. As a prudent measure that provides flexibility going forward, increasing EDC’s authorized capital stock opens up another avenue for fundraising, the company explained.”

Source: Philippine Daily Inquirer