Basic Energy eyes stake in Japan biomass plant

MANILA, Philippines — Listed Basic Energy Corp. is looking to invest at least 10 percent in a 25-megawatt (MW) biomass power plant in Japan as it part of its expansion outside the Philippines.

In a disclosure to the Philippine Stock Exchange, Basic Energy said it signed a term sheet with Vintage Holding Japan Co. Ltd. (VHJ) for the possible acquisition of a minimum 10 percent stake in a 25-MW biomass power plant in Karatsu City, Saga Prefecture, Japan.

VHJ holds full executive rights to the facility wholly-owned and -controlled by Biomass Power GK (IBP).

“Basic Energy’s participation in the aforementioned project is in line with its thrust to expand its portfolio of renewable energy projects in the Philippines and abroad,” the company said.

The  term sheet grants Basic Energy  the exclusive right to negotiate and finalize the terms of the investment with VHJ, with a refundable deposit to start the due diligence process on IBP and the project.

Basic Energy aims to complete the due diligence process in 60 days, and if results are favorable, it will sign a shareholders agreement with VHJ on or before June 30, 2018.

It will also have the option to increase its planned investment in the biomass project to up to 20 percent.

Previously, the company announced it was participating in four renewable projects located in Japan, Myanmar and Thailand.

Last month, it signed an investment term sheet with Vintage Engineering Public Co. Ltd. (VTE) of Thailand to acquire a minimum of 12.5 percent stake in the latter’s subsidiaries which are  building a 220-megawatt (MW) solar plant in Myanmar.

VTE’s subsidiaries, Vintage EPC Co. Ltd. and in Vintage International Construction Co. Ltd., bagged the supply and construction service contracts for the engineering, procurement and construction (EPC) of the said solar farm.

Basic is also eyeing to invest 49 percent in V.O. Net Biodiesel Asia Co. Ltd., which operates a 1.2-MW solar power plant located in Kalisin, Thailand.

Prior to that, the firm has been conducting due diligence on a 14-MW solar farm in Japan after remitting about P22.74 million to Solmax Power Ltd. of Hong Kong.

This as the company scouts for renewable energy investments overseas, particularly in Asia, given its fast turnaround time compared with geothermal projects.

Currently, it has five geothermal service contracts, namely the Mabini Geothermal Service Contract (SC) in Batangas, East Mankayan Geothermal Prospect in Ifugao, Mt. Mariveles Geothermal Project in Bataan, Mt. Iriga Geothermal Project in Albay and West Bulusan Geothermal Prospect in Sorsogon.

Among its projects in the pipeline, the Batangas project is the most advanced, with the drilling of an exploratory well currently under way. Basic partnered with Trans-Asia Oil and Energy Development Corp. to develop the resource.