MANILA, Philippines--The Ayala conglomerate is interested in investing in the Lopezes? geothermal crown jewel Energy Development Corp. (EDC) as part of its foray into the renewable energy business.

Industry sources told the Inquirer that Ayala Corp. was studying the possibility of coming in as a minority stockholder in EDC, but could not say whether the 175-year-old conglomerate had started active negotiations with the Lopez family for a portion of EDC?s holding company Red Vulcan Holdings Corp.

The sources said the Ayalas were keen on investing in ?clean? energy and that EDC provided a perfect fit.

It was earlier reported that the conglomerate had long been trying to break into the energy sector, but did not want to acquire coal-fired power plants, which were the ones mostly on the government auction block.

Shares of EDC?the local stock market?s new darling after the frenzy over another Lopez firm Manila Electric Co.?have surged by about 71 percent since March.

It closed at P4.45 a share at the local bourse on Wednesday, gaining another 2.3 percent before the local markets paused for a long Lenten break.

Based on last week?s close, EDC had a market capitalization of P64.8 billion.

The Lopezes? power generation unit First Gen Corp. said in a disclosure last week that it had yet to sign a definitive agreement in relation to a potential sale of up to 40 percent in Red Vulcan to Marubeni of Japan.

There has been talk in the market that the Lopez family is close to making a deal with a consortium led by Marubeni.

According to the First Gen disclosure, the potential deal with Marubeni is not the only option on the table.

?Also, be advised First Gen is in talks with several parties for potential investments in the group, in order to address its funding requirements,? First Gen assistant corporate secretary Rachel Hernandez told the local bourse.

Analysts said that the Ayala group was in a very good position to pick up assets for sale in this difficult economic environment. But unlike other deep-pocketed groups like San Miguel Corp. and First Pacific Co. Ltd., the conglomerate has not been too active in corporate mergers and acquisitions over the last two years.

Still, the Ayala group?s top management is on the lookout for opportunities in the horizon.

EDC, which used to be owned by the state firm Philippine National Oil Co., began commercial operations in 1983 and debuted on the local stock market in 2006. It engages in the exploration for, development and production of, energy resources in the Philippines.

Its operations consist primarily of electricity sales, steam generation, electricity generation and third party drilling. It operates 12 geothermal steam fields in five service contract areas where it is principally involved in the production of steam for sale to the National Power Corp.

From January to September last year, EDC had a turnover of P13.6 billion, of which the bulk of P8.3 billion came from the sale of electricity. During this period, it chalked up a recurring net income of P4.51 billion, up by 34.3 percent year-on-year.

EDC?s five services areas are: Leyte Geothermal Production Field, Southern Negros Geothermal Production Field, Bacman Geothermal Production Field in Luzon, Mindanao Geothermal Production Field and Northern Negros Geothermal Production Field.