AES Philippines, a subsidiary of American energy giant AES Corp. is raising $700 million for the development of its 300 megawatt (MW) coal-fired power plant in Masinloc, Zambales.
In raising the amount, Neeraj Bhat, AES market business leader for the Philippines, said 70 percent will come from debt and the remaining 30 percent will come from equity.
He added that the project will be locally funded by local banks.
Bhat said the project is on track as they target to start construction in the first quarter of 2016 and complete it by 2018.
“We expect to enter construction very soon with limited works this year and to be online in early 2019,” Bhat told reporters on the sidelines of the Innovation Infrastructure Congress on Tuesday.
He said the project is a single 300-MW coal plant which could be expanded up to 600 MW.
“Right now, we’re going to start with 300 MW. As we line up contracts, we have the option to go for the full 600 MW but right now we’re going for the 300 MW,” he added.
Prior to the development or the power plant, Bhat said they have already signed a number of power sales agreements (PSAs) with Northern Luzon and some other customers.
Bhat said they are set to sign the engineering, procurement and construction (EPC) contract at the soonest possible time.
“We’re signing very shortly. It’s an international quality. We haven’t disclosed it yet. It’s high-quality equipment, international standard equipment, western and high-quality EPC contractor that’s done a lot of work with us. We have a strong relationship,” he added.
AES Philippines has partnered with independent power producer Electricity Generating Public Co. Ltd. (EGCO) Group of Thailand for the project.
Bhat earlier said that AES is maintaining its 51-percent stake in the plant after selling 45 percent of its interest in the Masinloc facility to EGCO for $453 million.
With the sale, AES still has a 51-percent stake in Masinloc, EGCO has 41 percent while the International Finance Corp. (IFC) has 8 percent.