Listed Megawide Construction Corp. is diversifying into power generation with a preliminary plan to pour in nearly P5 billion worth of investment in the next two years to build up to 100 megawatts of renewable energy capacity.
Megawide chief financial officer Oliver Tan indicated that the company’s decision to participate in the country’s growing power industry is in line with its diversification, noting that the timing is perfect since the country is experiencing “short supply of power.”
On the sidelines of the company’s annual stockholders meeting held in Pasay on Monday, Tan told reporters that initially, the company plans to roll out 100 MW of renewable energy capacity in various locations across the country.
To be able to do this, the company estimates it would need a war chest of as much as $100 million or approximately P4.4 billion, which it intends to raise both through internally generated funds and a minimal amount of debt.
In a disclosure to the Philippine Stock Exchange on Monday, Megawide said it has entered into an agreement with another renewable energy firm, PhilCarbon Inc., to develop a portfolio of green energy projects.
Philcarbon is engaged in the development of clean sources of power such as wind, hydro, biomass and geothermal.
In an interview, Megawide chief information officer Louie Ferrer said that his company and PhilCarbon have set up a joint venture called Megawatt Clean Energy, which will take charge of the operation and development of their prospective energy projects.
For the joint venture firm’s maiden project, the company will develop a 3.5-MW biomass power plant in Aurora Province in Northern Luzon, which will break ground by the end of this year and is targeted for completion in the next two years.
Tan said Megawide owns the majority of Megawatt Clean Energy.
Megawide president Edgar Saavedra meanwhile told reporters that aside from PhilCarbon, the company is also in talks with other energy firms for potential partnerships.
He said that not all of the 100-MW target capacity of the company will necessarily come from the partnership with PhilCarbon.
The company said that Private-Public Partnership (PPP) projects and its venture into the power generation business should help Megawide double its revenues and income by 2017.
In April, the consortium of Megawide and India-based GMR Infrastructure was awarded the P17.5-billion Mactan Cebu International Airport Terminal Project.