January 12, 2015

AC unit secures financing for Mindanao coal-fired power project

In a press statement, Ayala Corp (AC) said that GN Power Kauswagan has secured additional funds to finance the construction of a 4 x 135 -MW coal-fired power plant in Mindanao. GN Power Kauswagan is a limited partnership owned by AC Energy Holdings Inc (AC Energy), a wholly-owned subsidiary of AC. The Mindanao coal project is estimated to cost around US$740m. Construction will start early this year with project completion targeted by 2017.

Our take: GN Power Kauswagan is the fifth power project undertaken by AC. Other power projects include GN Power Mariveles (660 MW coal-fired power farm in Ilocos Norte; 50% stake), North Luzon Renewable Energy Corp (81 MW wind farm in Ilocos Norte; 64% stake) and South Luzon Thermal Energy Corp (2 x plant in Bataan; 20% stake), Northwind Power Development Corp (52 MW wind 135 MW coal-fired power plant in Batangas, 50% stake).
Except for the coal-fired power plant in Mindanao and one 135 MW unit of the coal-fired power plant in Batangas, the remaining power generations units, with a total capacity of 928 MW, have been completed. The 135 MW coal-fired power plant in Batangas is scheduled to start commercial operations within 1Q15.

Although their overall contribution to AC’s consolidated earnings will remain insignificant over the medium-term , this should expand significantly once all the project are fully completed. By 2017, we estimate AC’s attributable capacity will jump to 945 MW (installed of 1,663 MW) from 277 MW (installed of 928 MW). – WealthSec