MANILA, Philippines—The South Luzon Thermal Energy Corp., a joint venture between Trans-Asia Oil and Energy Development Corp. and the Ayala-led AC Energy Holdings Inc., signed on Wednesday a P9-billion project loan facility to fund a 135-megawatt coal-fired power plant in Batangas.
In separate disclosures to the Philippine Stock Exchange, Trans-Asia Oil and Ayala Corp. said the loan facility was signed with lenders Banco De Oro Unibank Inc., Security Bank Corp. and Rizal Commercial Banking Corp.
“The loan will be used to fund the construction of the project, which is expected to be operational by mid-2014,” the two companies said.
In another development, Trans-Asia Oil also disclosed that it signed a long-term power purchase agreement with South Luzon Thermal. This agreement will allow Trans-Asia to purchase all the generated output of South Luzon Thermal’s coal power plant over the next 15 years.
Trans-Asia earlier reported that the Batangas “clean coal project” it was undertaking with the Ayala Group would have significantly lower carbon emissions than other coal-fired generating plants.
It explained that “clean coal technology” relies on a circulating fluidized bed technology that greatly minimizes the environmental impact of coal-fired plants through lower carbon, sulfur oxide and nitrogen oxide emissions. Emission rates from “clean coal plants” are estimated by the company to be about 60 percent to 70 percent lower than the existing requirements of the Department of Environment and Natural Resources.
Trans-Asia earlier said that it wanted to source its coal mainly from the Consunji-led Semirara Coal Corp., which produces coal with low sulfuric content. It also planned to import coal from Indonesia.
Apart from its planned coal plant in Batangas, Trans-Asia reported that it was also mulling over a similar 135-MW facility in Mindanao to help shore up generation capacity on the island.
Trans-Asia Oil has already begun the pre-engineering and feasibility study to build the facility in Northeastern Mindanao. Should the company proceed with the project, it expects the power plant to start operations by 2015.