PNOC-EDC nixes plan to float bonds

The PNOC-Energy Development Corp. (EDC), the geothermal development arm of state-owned Philippine National Oil Co., does not have any plan of floating bonds this year.

PNOC-EDC chairman and president Sergio Apostol said they prefer to get soft loans which carry much lower interest rates and longer maturity. "We have no plans yet (to borrow from international bond market). We still have to study the prospects of floating bonds," he said.

The company, he said, just paid a bullet payment for its $150 million Eurobonds. "We fully paid our Euro-denominated bonds last Dec. 5," he said.

Proceeds from the bond flotation were used by the company to finance its various geothermal projects. The bonds, he said, were issued in 1995.

Apostol said the company is planning to tap various multilateral financial institutions for soft and concessional loans of more than $600 million (more than P3 billion) for 2002 to finance its energy development projects.

The planned long-term borrowings will include a $56-million loan from Japan Bank for International Cooperation (JBIC) for the first phase of a 40-MW wind farm project; $36-million fron JBIC or Danish International Development Assistance (DANIDA) for the second phase of the wind farm; and $500 million for geothermal exploration projects this year.

He said the company needs about P1.68 billion for its drilling program for 2002 which involves the exploration of 15 new wells.