AboitizPower acquiring LFEI

MANILA, Philippines — The renewable unit of Aboitiz Power Corp. is taking over La Filipina Electrika Inc. (LFEI) to become a vehicle for renewable energy projects moving forward.

In a disclosure to the Philippine Stock Exchange, AboitizPower said Aboitiz Renewables Inc. (ARI) is acquiring LFEI from affiliate Therma Power Inc. (TPI) and Negros-based grains trader and miller La Filipina Uy Gongco Corp. for P192,500.

TPI owns 40 percent of LFEI, while La Filipina owns the 60 percent balance. ARI and TPI are both wholly owned subsidiaries of AboitizPower.

“This transaction will allow ARI and AboitizPower to use LFEI as a vehicle for future renewable energy projects,” the disclosure read.

LFEI, formerly called Therma Southern Mindanao Inc. (TSMI), was intended to be used for a joint venture power project.

Through TSMI, AboitizPower and long-time partner La Filipina decided to jointly participate in the privatization of the output of the 210-megawatt (MW) Mindanao coal-fired power plant in Misamis Oriental in 2015.

The plant, located in Misamis Oriental, is operated by Germany’s Steag State Power Inc. under a 25-year build-operate-transfer (BOT) power purchase agreement scheme until 2031.

Steag owns 51 percent of Steag State Power, with AboitizPower owning 34 percent and La Filipina the remaining 15 percent.

Steag State Power operates the Misamis Oriental plant, which was constructed under a build-operate-transfer agreement with the government.

However, the board of Power Sector Assets and Liabilities Management Corp. (PSALM) decided to defer the auction for the independent power producer administrator (IPPA) contract of the Mindanao coal-fired power plant because supply was still unstable in the region in 2015.

Based on information found on PSALM’s website, the IPPA contract bid for the Mindanao coal-fired power plant is set in 2022.

“Because TPI and La Filipina have decided not to pursue this potential project, TPI and La Filipina] intend to sell LFEI to ARI,” AboitizPower said.

Earlier, AboitizPower said it is still set on significantly expanding its portfolio of renewable energy power plants in the next 10 years and by 2030, its capacity mix will have been transformed into an almost 50:50 Thermal to Cleanergy ratio.

With this, the firm said it is on track to more than double its capacity from 4,432 megawatts to 9,300 MW by 2029 despite the negative impact of the pandemic on the power sector.

It said it would continue to be one of the largest players in the country with the largest installed capacity of renewable energy under its market control of 1,540 MW.