First Gen Corp. may venture into coal power generation by acquiring a stake in the Pagbilao coal-fired power plant in Quezon, which is undergoing expansion, company chair Federico R. Lopez told reporters.
First Gen is currently engaged in natural gas, hydroelectric, geothermal, and wind power projects.
The power firm of the Lopez group has an option to buy shares from TeaM Energy Corp., which manages the existing Pagbilao power station, Lopez said.
The company is interested in Pagbilao as it hopes to expand capacity given the growing energy demand.
It will be First Gen’s first venture in a coal project.
“We put higher priority on other projects. But it’s not like we’ve said no to coal,” Lopez explained.
TeaM energy Corp., a joint venture of Tokyo Electric Power Company and Marubeni Corp., will start expanding the Pagbilao coal-fired power plant in Quezon to produce 420 megawatts in additional capacity. The expansion will be completed in November 2017.
Implementing the expansion is Pagbilao Energy Corp—the joint venture consortium of TPEC Holdings Corp. (TPEC Holdings) and Therma Power, Inc., wholly owned subsidiaries of TEC and Aboitiz Power Corp., respectively
Pagbilao Unit 3 will be built on the same location as the existing 735-MW Pagbilao units 1 and 2 within the Pagbilao power station.
According to First Gen president Francis Giles B. Puno, the company may get a stake of “less than 20 percent” in the Pagbilao plant.
Puno said an agreement with Marubeni and Tokyo Electric gave First Gen the option to have an equity participation of up to 33 percent in the Pagbilao expansion. However, since TeaM Energy and Aboitiz Power are set to undertake the expansion under a 50-50 joint venture. Theoretically, this leaves First Gen with about 15 percent of the whole expansion project.
Puno admitted that the plan to buy a stake in the expansion of a coal project could be “against our religion” since First Gen’s power portfolio consisted of natural gas and renewable energy power plants.
Puno said there had been initial talks following previous announcements of the expansion power project, but there were no clear details yet as to how the proponents would proceed with the project.