Napocor trims borrowing requirement for 2003

After conducting an audit and re-evaluation of its borrowing program, the National Power Corp. (Napocor) has trimmed down its borrowing requirement for the year from $2 billion to only $1.2 billion.

Finance Secretary and Napocor chairman Jose Isidro Camacho told reporters over the weekend that the beleaguered power company need not borrow as much as it originally projected.

According to Camacho, Napocor went through its 2003 borrowing program "with a fine-toothed comb" and dropped certain items for funding that do not have to be included.

However, Camacho declined to explain how Napocor was able to trim down its borrowing requirement and what items were dropped from the list of items that require funding for 2003.

Camacho only said the original borrowing program was evaluated item by item and the process effectively eliminated about $800 million worth of items that were originally thought to require funding.

The resulting amount, Camacho said, includes the borrowing requirement of the Power Sector Asset and Liabilities Management Corp. (Psalm) as well as the planned acquisition of some small independent power producers (IPP).

"Napocor already has a line-up of small IPPs that it could buy out. These are only small IPPs that are really attractive," Camacho said. "The trimmed borrowing program already took that into consideration."

Camacho said the borrowing program also accounted for Napocor’s maturing obligations this year although he did not disclose how much of the company’s obligations would require re-financing for 2003.

Since Napocor has already raised a total of $700 million from its pre-funding activities late last year and early this year, Camacho said the power company actually only needs to raise $500 million more for the rest of the year.