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PNOC
Energy Development Corp., the Philippines’ largest
geothermal power producer, said it may borrow as much as
P25 billion this year for expansion and acquisitions.
“Of the
P25-billion programmed capital expenditure, 70 percent
will be sourced from the financial market and the
remaining 30 percent will be coming from equity,” Paul
Aquino, EDC president, said at its first stockholders
meeting under the First Gen Corp. Part of the
P25-billion expected capital expenditure this year will
include the $200-million financing to be sourced from
the International Finance Corp. (IFC) if approved.
Aquino added that EDC is allowed to borrow up to P40
billion this year if needed.
This may include projects in Indonesia, where the
company is seeking a partner, Aquino told reporters at
the company’s annual meeting yesterday. The partner may
be a state-run company, he said, declining to elaborate.
The
company also plans to hedge more of its yen-denominated
debt to protect the utility against decline in the
Philippine currency, Aquino said. The peso’s 11-percent
slump against the yen this year has made it more
expensive to pay foreign-currency debt. Yen-denominated
debt makes up 83 percent of the company’s P25.3-billion)
total, he said. The power producer has already hedged ¥8
billion of its ¥12 billion of debt maturing in June
2009, he said.
“We
recently concluded two hedging transactions covering ¥8
billion or 67 percent of the ¥12-billion Miyazawa 1 that
is set to mature in June next year,” said Aquino, adding
that proceeds from the borrowings will cover for its
various expansion and acquisition plans.
EDC’s
total liabilities dropped by 25 percent to P33.6 billion
in the first quarter of the year from P44.7 billion in
the same period last year.
EDC added that its long-term debt amounted to P25.3
billion in the first quarter of the year, of which 83
percent are yen-denominated loans.
In
another development, the EDC official also noted that
they remained to be the preferred drilling contractor of
Lihir Gold Ltd. of Papua New Guinea after the latter
signed a new contract worth $16.11-million.
The one-year contract covers the drilling of seven
geothermal wells, three dewatering wells, one work-over
well, and includes the supply of third party drilling
services such as mud engineering, well cementing, and
directional drilling.
During the contract signing held in Lihir Island, Papua
New Guinea, LGL Mine Manager John Flynn expressed his
satisfaction at the drilling and safety performance of
EDC on the last drilling campaign and said he is looking
forward to exceeding even that for the new campaign.
LGL, which is one of the leading gold producers in the
Asia Pacific region, sources most of its power
requirements for its gold mine and processing facility
from geothermal energy. It has announced that it is
ramping-up its gold output to 1-million ounces per year
and thus needs to expand its existing 56 MW geothermal
power plant by an additional 40-MW to support its
expansion program.
EDC’s contracts with LGL have been its major source of
drilling revenues since 1999.
Last year, EDC’s income from International Drilling
Contracts jumped to P624.8 million from the previous
year’s P261.5 million.
EDC’s Drilling Group is currently upgrading its rigs and
other drilling equipment to bag more drilling contracts
overseas. |
