Consunji-led firm Semirara Mining and Power Corporation (SMPC) has terminated its joint venture agreement (JVA) with Meralco PowerGen Corporation (MGen) for the previously proposed 700-megawatt St. Raphael Power Generation Corporation (SRPGC) in Calaca, Batangas.
The deal between SMPC and MGen was sealed in 2016, but the project never advanced because of the legal hurdles that then impeded the approval of the power supply agreements (PSAs) of Manila Electric Company, including for that facility.
In a disclosure to the Philippine Stock Exchange (PSE), SMPC indicated that the joint venture deal is deemed terminated as of November 9, 2020, and that the Consunji firm “shall reacquire all the equity shareholdings of MGen in SRPGC.”
The Meralco power investment firm and SMPC had 50:50 equity ownerships in the planned St Raphael coal-fired power project. Based on the facility’s blueprint, that was designed to be of two units with 350MW capacity each.
The agreement of the parties had been underpinned by a PSA that was filed with the Energy Regulatory Commission (ERC) in 2016; but that was among the contracts questioned in a case filed at the Supreme Court – in which the high court voided in a decision rendered in 2019 because it mandated the conduct of competitive selection process (CSP) for all off-takes that Meralco will have on its supply portfolio.
Given the SC ruling, several power projects had been affected – and the propounded St Raphael coal-fired power facility had been one of those that stalled on reaching implementation phase.
The current power generation portfolio of the Consunji group include the 600MW Sem-Calaca power facility; and the 300MW Southwest Luzon Power Generation Corporation – all sited in Calaca, Batangas.
On the part of MGen, it targets its own power generating projects both on thermal facilities like coal; and also on renewable energy installations of varying technologies, such as solar, wind and hydro.
Coal power plant developers in the country are seen re-evaluating their future investment plans — given the slump in electricity demand because of the coronavirus pandemic and in keeping also with the recent declaration of the Department of Energy (DOE) for a moratorium on greenfield development of such type of energy technology.
On SMPC’s part, it earlier indicated that it will be on paced spending this year; and will instead re-schedule P3.7 billion worth of capital expenditure (capex) next year because of the economic impact of the pandemic.