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The International Finance Corp. (IFC) is set to provide a multimil-lion-dollar
financing to US-based AES Corp. to partly fund its acquisition of
the Masinloc coal-fired power plant in Zambales.
In a statement, the IFC said that AES has tapped
a $275-million loan from the lender to support the company’s
winning bid of $930 million for the 600 megawatt Masinloc facility,
which the Philippines auctioned off last July.
“[Masinloc Power Partners Co. Ltd.] plans to
rehabilitate Masinloc to improve its operating performance such as
plant’s availability and to address certain environmental issues
such as excess dust emissions to ensure its environmental
compliance,” IFC said.
The total project cost for the Masinloc facility
is estimated to reach up to $1.1 billion, which includes the
acquisition price, funding for the debt service reserve account,
transaction costs, refurbishment works and initial working capital
needs.
The power plant was designed and commissioned in
1998 as a two-unit, 600 megawatt facility and uses refined coal from
Australia, China, Indonesia and occasionally local coal.
AES’ bid for the Masinloc facility, which was
tendered through its unit Masinloc Power is the highest bid ever
fetched by a government-owned power plant.
The New York Stock Exchange-listed US company is
a leading global power developer and operator, with 13 regulated
utilities and 121 generation facilities having a combined generation
capacity of around 43,000 megawatts.
IFC said that AES’ Masinloc investment will
reinvigorate foreign investors interest in the country’s power
privatization program and improve the operational and environmental
performance of the plant.
“The project is the post-privatization
financing of an existing coal-fired power plant that has been in
operation since 1998. The project sponsor has commissioned an
environmental due diligence audit and a technical condition
assessment of the plant to assist in planning necessary equipment
and procedural upgrades,” the IFC said.
--Euan Paulo C. Añonuevo
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