GN Power raising $1 B for Bataan coal power plant

MACTAN, Cebu, Philippines – GN Power Mariveles Coal Plant Ltd Co. plans to raise as much as $1 billion by year-end to start construction of the first unit of the 2x600-megawatt (MW) Bataan coal-fired power facility in 2016.

GN Power is targeting to start building the first unit of the coal facility, which is an expansion of the existing 600-MW coal-fired power plant in Mariveles, by early next year, AC Energy Holdings Inc. president and CEO John Eric T. Francia said on the sidelines of the Asia Pacific Economic Cooperation (APEC) Energy CEO meetings held here.

The first 600 MW unit will cost around $1 billion, and GN Power is in the final stages in raising capital, he said.

“Were hoping to close [financing] by this year. That’s our target, at least for the first unit,” Francia said. “[We will borrow] all of it. We have to fund all of it to start construction.” 

US-based GN Power, owned by Nauruan-American firm Power Partners Ltd. Co., partnered with Ayala subsidiary AC Energy to develop the expansion of the Bataan plant, which started operating in 2013.

In January 2014, AC Energy acquired a 17 percent stake in GN Power. Other investors in the Bataan plant include Sithe Global Power LLC, a company owned by investors of The BlackStone Group.

Francia said the facility will be built in phases to be able to secure offtakers.

GN Power is in the process of selling contracts for the output of the first unit.

“I think we’ll have to phase it, its more realistic that way. It’s difficult to build the whole 1,200 MW if there are a lot of  building plants in Luzon,” he explained.

For the engineering, procurement and construction (EPC) contractor, the AC Energy official said the project company will “sign soon” a contract.

“We haven’t decided yet on the turbine generator but its going to be Western,” Francia noted.

Data from the Department of Energy (DOE) showed the expansion of the Mariveles plant has received clearance to undertake a grid impact study (GIS) on June 26, 2013 and has secured the necessary local government unit (LGU) endorsements last March.