Basic Energy explores solar projects in Japan

MANILA, Philippines - Basic Energy Corp. is exploring possible investments in solar plants in Japan as part of its overseas expansion after the Philippine government decided to discontinue the feed-in tariff (FIT) scheme.

In a disclosure to the Philippine Stock Exchange, Basic Energy said its board approved to make a refundable earnest deposit to be made with Solmax Power Ltd. of Hong Kong to conduct due diligence of Solmax and its project portfolio.

Sought for comment, Basic Energy SVP and general manager Anthony Cuaycong said the company is required make a refundable deposit in order to conduct due diligence on Solmax and its solar projects in Japan.

“We have been invited to invest in Solmax for its solar projects in Japan. But in order for us to assess Solmax and conduct due diligence on its projects, we need to do a refundable deposit,” he said.

Depending on the assessment, Basic Energy’s deposit will be converted into equity or refunded.

“We will take a look at Solmax and its projects, and if we are satisfied, our deposit will be turned into equity. If we are not, it will be returned,” Cuaycong said.

Earlier, the company said it is scouting for solar power investments overseas, particularly in Asia, with its partner Vintage Engineering Public Co. Ltd., a publicly listed company headquartered in Thailand with a nine-percent stake in Basic Energy and has the option to raise its interest to 25 percent.

This is in light of the recent pronouncement by government to scrap the FIT, a set of incentives given to power developers for a period of 20 years to invest in the more expensive renewable energy sector.