SNAP pushing back construction of Alimit Hydropower Complex

MANILA, Philippines — SN Aboitiz Power Group (SNAP)—the joint venture of SN Power of Norway and Aboitiz Power Corp.—is pushing back the construction timeline of its 390-megawatt (MW) Alimit Hydropower Complex to firm up the cost and design of the project, its top official said.

SNAP president and CEO Joseph Yu said the company’s board directed the project development team to lower the capital expenditure (capex) of the project.

 “We presented (the project details)to the board in August. After some deliberation, we felt that capex needed a little more work,” he said.

 “We’re going to spend another three to six months to sharpen those technical design, do some value engineering and get a more solid number, and then go back to make a decision,” the company official said.

Originally, SNAP was targeting to proceed to pre-construction phase within the third quarter after getting all the necessary permits, which include free, prior and informed consent, environment compliance certificate and endorsement from local government units (LGUs).

Last June, a framework agreement for the proposed Alimit project was signed with the municipal government of Lamut, the last of the four LGUs to approve Ifugao’s first large-scale hydropower facility. Other municipalities are Aguinaldo, Lagawe and Mayoyao.

The agreement outlines the cooperation, collaboration, and obligations between and among SNAP as project proponent and the municipalities as hosts during the development and operation phase of the project.

In reviewing the design of project, Yu said they are targeting to reduce the project cost by 15 to 20 percent.

“I’d like to get it to about $4 million to 5 million per MW. Right now we’re way over that, I’d like to bring it down 15 to 20 percent,” he said.

Among the challenges being faced by the company include the hydrology, seasonality and access to the area of the project.

The seasonality not only affects the inflow of water, but also the speed to constructing the project, Yu said.

Once the review is done, the project will be presented to the board once again for approval to proceed to pre-construction phase and arriving at a final investment decision (FID).

 “Pre-construction, that’s the phase where we will finalize the design, get the documents, tender it out to contractors, and get firm quotes,” Yu said, noting this could take 18 to 24 months.

 “Once we have all those in, we’ll line up the financing and then we’ll go into FID. Once we get that, that’s when we break ground,” he said.

The Alimit project consists of the 20-MW Ollilicon, the 120-MW Alimit hydroelectric power plants and the 250-MW Alimit Pumped Storage.

The project aims to combine the waters of the Alimit River and Ibulao River to generate electricity. To supply power to the grid, it requires a 42-km 230 KV transmission line.

The complex encompasses four ancestral domains in the municipalities of Aguinaldo, Lagawe, Lamut and Mayoyao, with 81 host barangays under these domains.