LOPEZ-LED Energy Development Corp. (EDC) is raising P5 billion to finance the expansion of its Bacon-Manito geothermal (Bacman) facility and other steam field plants in Mindanao.
Erwin O. Avante, vice president for corporate finance, said the P5 billion financing will be raised within two to three months at the subsidiary level, meaning through its unit Bacman Geothermal Inc. (BGI).
“The financing for Bacman is P5 billion and will be raised within two to three months through local banks,” Avante told a briefing after the company’s annual stockholders’ meeting on Tuesday.
EDC president and chief operating officer Richard B. Tantoco said they are expanding the Bacman facility to more than 50 megawatts (MW).
He said they are targeting Bacman 3 to generate at least 30 MW, while Bacman 4 should generate 17-20 MW.
The notice to proceed construction of the $150 million [(P223 million) Bacman 3, Tantoco added, is set to be issued in the third quarter of the year.
In the case of Bacman 5, Tantoco said they could not still project the capacity but added there is a large potential of resource.
EDC is running Bacman 1 and 2, located in Sorsogon and Albay, with a combined capacity of 140 MW. The facility underwent repairs after it sustained damage from Typhoon Glenda (Rammasun) last year.
At the stockholders meeting, Tantoco said the Bacman facility, after it was rehabilitated and up-rated, contributed to the revenue of the company last year.
“The two larger Bacman power plant units are now operating as the most efficient in our fleet,” said Tantoco.
The company also attributed the increase in revenue to the commissioning of EDC’s 49.4-MW Nasulo power plant in Negros Oriental.
Tantoco said EDC’s consolidated revenue in 2014 grew 20 percent to 30.9 billion from P25.7 in 2013 primarily due to the efficient and better performance of its power plants.
He also said the company posted a “strong” P9.3 billion recurring net income, which is up 40 percent from the previous year, attributable to EDC.
“We are looking at it as better than last year, but most realistic, we have a slower growth but improved higher revenues,” said Tantoco.
At the same time, Tantoco said the company lowered its power rates with the fall of global prices for coal and oil in 2014 and in response to fierce competition.
“This move will cost the company about P911 million in the short term but will provide stable revenue streams in the future,” he said.
He also cited EDC’s record-high cash flow, wherein it had a beginning cash balance of P16 billion, which was further strengthened by cash generated from operations amounting to P16.9 billion.
Apart from the Bacman and Nasulo plants, EDC also runs the 106-MW Mindanao Geothermal Power Complex which provides Mindanao with green and sustainable power.