Toledo Power Co., a subsidiary of the Metrobank Group’s Global Business Power Corp., is putting up a 72-megawatt coal-fired power facility to supply the power requirements of a mine site operated by Atlas Consolidated Mining and Development Corp.
The bulk of the electricity to be generated from this facility, which is expected to start commercial operations by the end of 2014, will be used specifically for the Toledo copper mine of Atlas subsidiary Carmen Copper Corp. (CCC).
In a disclosure to the Philippine Stock Exchange Wednesday, Atlas said the CCC had already forged a 12-year electric power purchase agreement (EPPA) with Toledo Power to guarantee the supply of up to 60 MW of electricity to the copper mining operations.
“The EPPA was entered into by the concerned parties to provide for the projected increase in CCC’s power requirements as a result of the intended expansion of its production capacity from 40,000 tons of copper ore per day to 60,000 tons,” Atlas said.
As CCC and Toledo Power await the start of the power plant’s operations, the two groups have entered into an energy conversion agreement. Under this, CCC committed to supply to Toledo Power the coal required to generate the capacity needed by the mining firm.
Atlas said the energy conversion agreement would help reduce CCC’s power procurement cost by 35 centavos per kilowatt-hour.
Once the facility starts commercial operations, the power procurement cost is expected to further drop by another 30 centavos per kWh.
“Through its partnership with TPC under the electric power purchase agreement and the energy conversion agreement, CCC has established access to a long-term power source in accordance with its cost minimization strategy,” Atlas added.