Meralco unit borrowing P100b from 8 banks

Atimonan One Energy Inc., a unit of Manila Electric Co., tapped Bank of Philippine Islands, Philippine National Bank and six other banks to raise P100 billion for the completion of a 1,200-megawatt ultra supercritical coal plant in Atimonan, Quezon.

“There are seven to eight banks. BPI and PNB, let’s say they’re  two of the major lenders,” Manila Electric Co. president Oscar Reyes told reporters.

Atimonan One is majority controlled by Meralco PowerGen Corp., the power generation arm of Meralco.

Meralco signed a 20-year power supply agreement with Atimonan One to purchase its entire electrical output.  The application is still pending with the Energy Regulatory Commission.

“We continue to engage with ERC…We filed our application for PSA approval in April 2016 so it’s been close to 16 months. The important thing is, every month [of delay] results in higher project cost because the EPC cost are increasing and exchange rates are moving,” Reyes said.

Atimonan One power plant’s project financing hinges on the approval of the PSA. The P100 billion financing for the plant is touted to be the biggest for the energy sector.

“So in order to ensure the viability of the project, and the lower price for consumers, it’s best if early approval can be given,” the Meralco official, adding that he has faith in the ERC to make a decision within the announced three-month deadline.

Atimonan One is also currently in the final stage of its selection and contract documentation process for an engineering, procurement and construction contractor for the plant, the country’s first ever ultra supercritical power plant.

Meralco chairman Manuel Pangilinan said earlier Atimonan One received proposals from possible partners in the project. “There’s a final list of four. Combination of foreign and local,” he said.

Pangilinan said Meralco PowerGen would keep a 51-percent stake in the project and “we will not sell control.”

Atimonan One targets to start site preparations by mid-2017.  It expects the completion of unit 1 (600 MW) in 2021.

Reyes earlier said the move to design a supercritical pulverized coal plant would address environmental and efficiency concerns.

“Ultra supercritical is the most fully efficient, most environmental friendly technology as far as coal-fired power plants are concerned. It’s more expensive but more efficient,” Reyes said.

The Atimonan One project is one of the several power projects lined up by Meralco PowerGen which plans to build 3,000 MW.

Topics: Atimonan One Energy Inc. , Manila Electric Co. , Banks , Bank of Philippine Islands , Philippine National Bank
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