South Luzon Thermal Energy inks P9-billion loan for Batangas project

MANILA, Philippines - South Luzon Thermal Energy Corp., a joint venture between Ayala Corp.’s AC Energy Holdings Inc. and Trans-Asia Oil & Energy Development Corp., signed a P9-billion loan facility with three local banks to partly fund the construction of a 135-megawatt power project in Calaca, Batangas.

South Luzon, a 50-50 joint venture between Ayala Corp. and the Phinma Group’s Trans-Asia Oil and Energy Development Corp., was initially capitalized at P200 million.

The loan facility was provided by Banco de Oro, Security Bank and Rizal Commercial Bank, Ayala Corp. said in a disclosure to the stock exchange.

The P12-billion project involves the construction of a 135-megawatt circulating fluidized bed (CFB) power plant, slated to be operational by mid-2014. CFB is a combustion technology that uses solid fuels, such as coal or biomass, to generate energy at a lower sulfur emission.

AC Energy, recently formed several joint venture agreements to develop solar and mini-hydro power projects across various sites in the country. It also recently acquired a 50-percent stake in Northwind Power that operates the wind farm in Bangui, Ilocos Norte.

The company also forged a joint venture with Sta. Clara Power Corp. , an independent power producer that focuses on the river hydroelectric plants. It will take a 70-percent stake in the joint venture and shell out an initial P600 million to develop run-of-the-river hydroelectric power projects across the country.

Run-of-the-river hydroelectric power plant operation involves “borrowing some river water to turn its kinetic energy into electricity, and returning the same unpolluted water back into the river. It is green because it does not produce harmful emissions. Like other renewable power technologies, it is economical as it depends on the “free energy” of nature as fuel.

The project is deemed an important component of the group’s plan to create a portfolio of power assets over the medium-term that blends conventional and satisfiable energy sources and contribute to the country’s energy requirements.

AC Energy aims to build a portfolio of power generation assets of over 1,000 MW in the next five years.

On the other hand, Trans-Asia’s wholly-owned unit Trans-Asia Renewable Energy Corp., has aggressively pursued the development of renewable energy and has been awarded service contracts with potential capacity of 350 MW, making it one of the largest wind developers in the country today.