EDC selling fresh P10-B green bonds

MANILA, Philippines — The Securities and Exchange Commission (SEC) approved Lopez-led Energy Development Corp.’s (EDC) sale of up to P10 billion in green bonds, which the company would maximize to fund renewable energy projects.

In a disclosure on Monday, parent firm First Gen Corp. said this is the second tranche of EDC’s P15-billion Asean (Association of Southeast Asian Nations) green bond program.

The base issuance was set at P6 billion, but EDC would sell P3 billion more in the event of an oversubscription or high demand.

The offer period is scheduled for May 13 to May 17.

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The bonds will have yields of 6.7478 percent, 6.8873 percent, and 7.0626 percent for the three-year, five-year, and seven-year series, respectively.

Local debt watchdog Philippine Rating Services Corp. (PhilRatings) gave EDC a credit rating of PRS Aaa with a stable outlook. Obligations rated PRS Aaa are of the highest quality with minimal credit risk. A stable outlook means the rating is likely to remain unchanged in the next 12 months.

Credit rating

PhilRatings rendered the credit rating because of EDC’s leading position as a pure renewable energy company. It also took note of the strong support from its parent company and its highly experienced management.

It also considered EDC’s strong operating cash flow and sufficient liquidity amid a conservative capital structure and the government’s supportive policies toward the renewable energy sector.

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“This second tranche Asean green bonds will support the growth and resiliency of our renewable energy portfolio as we serve the growing economy’s increasing energy needs while pursuing the country’s decarbonization and net zero journey,” EDC president and COO Jerome Cainglet said.

“This will be part of the P60-billion capital investment program that EDC is undertaking for its drilling operations program over the next three years and its renewable energy growth initiatives,” he added.

Cainglet also said proceeds of the bond sale would partially finance the firm’s geothermal and battery expansion projects and various resiliency and maintenance capital expenditure projects.—JORDEENE B. LAGARE INQ