Local banks help raised P14B for Panay power plant
Posted on February 26th, 2010
Local banks have agreed to help raise and lend the Panay Energy Development Corp. (PEDC) P14-billion for its construction of a 164-megawatt coal-fired power plant in La Paz, Iloilo City. The Panay Energy is owned by George Ty’s Metrobank group, and the loans were arranged by First Metro Investment Corp. (FMIC), the investment banking arm of Metrobank.
The deal is the second-biggest peso-denominated project loan facility to be purely funded by local institutions. The biggest was the P16-billion deal raised by Cebu Energy Development Corp., another Metrobank affiliate, for its power plant in Toledo City, Cebu.
FMIC was able to get the commitment of local banks for a 12-year loan to PEDC. These banks include Allied Banking Corp., Bank of the Philippine Islands, China Banking Corp., Land Bank of the Philippines, Metropolitan Bank and Trust Co., Philippine National Bank, Philippine American Life and General Insurance Co., Rizal Commercial Banking Corp. and the Union Bank of the Philippines. The loans represent about 70 percent of the funding of the project.
PEDC expects the power plant to be finished and already in operation in six to nine months time, and it will use “clean coal” technology. FMIC president Francisco Sebastian said that once completed, the power plant would make brownouts in the Visayas history as the new facility would account for 80 percent of the existing power generation capacity of the island.
Formosa Heavy Industries will be the one to build the new power plant by PEDC. It will also undertake the engineering design and procurement. The Metrobank group hopes to recover the costs from the project over a 25-year period.
PEDC is a subsidiary of Metrobank group’s Global Business Power Corp. Its president Jesus Alcordo said that despite the fuss over renewable energy, clean coal technology was still much more competitive.
The Metrobank group, at present, is still looking for opportunities in power generation, said chairman Antonio Abaca, adding that they prefer investing in new power plants rather than acquire old ones.
!. . what the helL. . local banks should’nt support coal fired power pLants. . they’re just heLping those bullshit companies kill people . . coaL harms a lot. . they know that. . but then they were very selfish. . greedy. ..worshiping their own god. . money!