Basic Energy unit eyes service contract with DOE

Basic Energy Corp. (BSC) has accepted a subsidiary’s plan to enter into a service contract with the Department of Energy (DOE) for the development of a 50-megawatt wind farm in Batangas.

BSC said in a disclosure that its board had ratified a decision of the board of wholly owned Mabini Energy Corp. to approve a pro forma wind energy service contract with the DOE.

The contract provides for a one-time, five-year predevelopment period as well as a 25-year development stage, which can be extended by another 25 years if the DOE approves.

The potential project is to be located in a 4,860-hectare area on Mabini Peninsula in Mabini, Batangas.

This development comes as the parent company anticipates an infusion of P2.8 billion from the Villavicencio group’s MAP 2000 Development Corp. (M2DC) through a transaction whose conditions are yet to be fulfilled.

The infusion is to be made through M2DC subscribing to about 9.8 billion primary shares in BSC, representing a 67-percent stake in the company.

These shares will be issued out of a planned doubling in BSC’s authorized capital stock from P2.5 billion to P5 billion, which still needs the approval of the Securities and Exchange Commission.

BSC said the transaction, expected to close in the second quarter of 2021, would enable the company to expand its current portfolio of energy-focused projects, including interests in renewable energy assets such as solar, wind, biomass, petroleum and other types of energy projects.