First Gen plans $265-M loan to finance Batangas project

by Lenie Lectura, BusinessMirror

Posted at May 13 2014 07:35 AM | Updated as of May 13 2014 03:35 PM

MANILA - First Gen Corp., controlled by the Lopez group, said on Monday it will tap German bank Kreditanstalt fur Wiederaufbau (KfW) for a $265-million loan facility to partly finance the San Gabriel natural gas-fired power plant in Santa Rita, Batangas.

“The $300-million bond [issuance] last year was very helpful. This year, for the San Gabriel, we will tap the same market, KfW. It’s a $265-million long-term loan. [The financing] for the San Gabriel project [will] predominantly [come from] KfW and the balance will be sourced from local banks,” First Gen President and Chief Operating Officer Francis Giles Puno said.

First Gen’s wholly owned subsidiary First NatGas Power Corp. broke ground in January, the first unit of the San Gabriel power plant.

The first generating unit will be a 414-megawatt (MW) facility worth $600 million. It is expected to start commercial operations in 2016. Once put up, it will sell electricity to the Luzon grid, utilizing gas from the Malampaya gas field. This will be financed through an export-credit agency-covered loan and the proceeds of First Gen’s recent $300-million bond offering.

The two other generating units will each have a capacity of 414 MW and cost $400 million.

To complete the additional 1,342-MW capacity First Gen plans to provide, the company will put up another power plant with a capacity of 100 MW worth $1 billion. Initially, this is called the Avion power project, which will also be built within the Santa Rita complex.

The Avion project is a vital facility for First Gen’s planned LNG (liquefied natural gas) terminal worth $1billion.

The San Gabriel project will provide critical additional power supply by 2016 and will be the most efficient gas-fired plant in Southeast Asia using the Siemens 800 H gas-turbine technology. “We will also be contracting some of San Gabriel’s 414-MW electricity supply in time for its commissioning in March 2016,” added Puno.

First Gen is one of the largest Filipino-owned independent power producers in the country, with, an existing plant portfolio of about 2,763 MW of generation assets that primarily utilize indigenous, clean and/or renewable fuels.

The project will provide an additional 1,342 MW of capacity between now until 2019, bringing the total capacity of its LNG-fired plants to more than 3,000 MW.