Basic Energy takes step closer to building P5-B wind park
MANILA, Philippines — Basic Energy Corp. and Japan-based Renova Inc. intend to finalize within this month a partnership to jointly develop the P5-billion Mabini wind project in Batangas province.
“Both groups are working hard to complete and close on or before the end of the month of February 2025,” Basic Energy informed the local bourse on Friday.
READ: Basic Energy, Japan’s Renova firm up collab for P4.5-B wind project
In April 2024, Basic Energy announced the signing of a joint development shareholders agreement (JDSHA) with Renova, an independent renewable energy developer based in Tokyo, to work on the 50-megawatt wind power project in the town of Mabini.
The pact involves forming a joint venture on a 50:50 equity basis in RDG Wind Energy Corp. (formerly Mabini Energy Corp. or MEC), the special purpose vehicle for the planned wind facility.
Crucial move
Basic Energy said that while the partnership with Renova does not materially affect its business and operations since the transaction is facilitated through its subsidiary, it is considered “an integral step” in advancing the wind project “and seeing it to actual fruition.”
“The partnership with Renova is seen as a necessary step toward realizing the fulfillment of the Mabini Wind Energy Project. Renova brings with it its years of expertise and knowledge base in the development of renewable energy projects,” Basic Energy said.
As part of the deal, a portion of MEC shares owned by Basic Energy would be transferred to Renova to account for a 50-percent stake in the joint venture company.
As part of the partnership agreement, Basic Energy announced the cross-sale of its shares between its subsidiaries RDG Wind Energy and Basic Diversified Industrial Holdings Inc. as part of finalizing the JDSHA.
Basic Diversified Industrial Holdings purchased 18 million shares in RDG Wind Energy for P0.125 apiece or a total of P2.25 million.
This undertaking marks a “key milestone” in the construction of the Mabini project, as the recently completed wind resource assessment showed positive results regarding the site’s wind conditions.
The wind facility will be financed via a debt-to-equity ratio of 70:30, with the budget to be decided by both parties while the equity portion of the funds will be split based on the shareholding interest of each entity.
Basic Energy said the project cost is estimated at P5 billion as of this date.
The Mabini wind project, covered by the wind energy service contract issued by the Department of Energy, is situated across a 4,860-hectare contract area in the Mabini peninsula.
The contract covers a 25-year term, including a five-year predevelopment phase, which can be extended for another 25 years.
