San Miguel unit to put up coal-fed plants in Cavite, Leyte

MANILA, Philippines—The San Miguel group is in the “advanced” planning stage to build two new coal-fired power plants in Cavite and Leyte, both part of its P90.4-billion greenfield power portfolio expansion plan.

In a recent regulatory filing in relation to its upcoming stock debut worth as much as P36.9 billion, SMC Global Power Holdings Inc. said the two upstart or greenfield power projects would come on stream by the first quarter of 2015. The Cavite phase-1 project in Ternate will have two power plants each with a capacity of 150 megawatts while the project in northern Leyte will have a 150-MW capacity.

SMC Power is also considering possible greenfield projects in Bulacan and Davao. The P90.4-billion estimated expenditure requirement is for the development of the projects in Cavite phase-1, Leyte, Bulacan and Davao. Up to P19.2 billion in net proceeds from an upcoming initial public offering were earmarked for these projects through 2016.

The plan is to build 3,000 MW of new power-generation capacity apart from continuing to acquire existing or brownfield power assets over the next 10 years.

In particular, SMC Power has affirmed plans to bid this October for the contracted capacity of the Naga power plant complex in Cebu with a combined installed capacity of 146 MW.

Another power asset on the auction block is the contracted capacity of the Unified Leyte geothermal power complex comprising four plants with a combined capacity of 588 MW.

Based on the revised prospectus filed by SMC Power, it will offer at least 348 million to as much as 519.75 million common shares at P71 each.

The proposed base offer is a minimum of 290 million and a maximum of 385 million common shares, of which 217.5 million to 288.75 million will consist of primary shares and 72.5 million to 96.25 million in secondary shares. The company may upsize the offering by as much as 77 million common shares in a mix of primary and secondary shares. These will be on top of an additional 43.5 million to 57.75 million secondary common shares for the overallotment option.

SMC Power is one of the biggest power companies in the Philippines with a 17.5-percent share of the power supply of the national grid and 23.5 percent of the Luzon grid as of end-June.