Basic Energy secures service contract for 50MW wind project

Listed firm Basic Energy Corporation has formally secured wind energy service contract (WESC) from the Department of Energy (DOE) for its planned 50-megawatt wind farm installation in Mabini, Batangas.

The company, which is chaired by businessman Oscar C. De Venecia, disclosed to the Philippine Stock Exchange (PSE) that the DOE approval on its proposed RE project was formally communicated to it on March 23 this year.

The targeted facility will be placed under corporate vehicle Mabini Energy Corporation, which will serve as a wholly owned subsidiary of Basic Energy.

As emphasized, the RE service contract covers an area of 4,860 square meters of land, which will be the subject of resource assessment of the company on the actual wind energy potential of the targeted site.

The firm’s service contract sets a five-year non-extendible pre-development stage for the venture; and if the resource will be established viable for commerciality, the development stage will be for 25 years.

“The proposed project has a potential capacity of 50MW and is projected to start commercial operations by 2027 or five (5) years from date of awarding of the WESC,” Basic Energy has stated.

The company, which predominantly ventured in the upstream petroleum sector, has been diversifying into the RE sector – not just in the Philippines, but also in its joint venture undertaking with Thai firm Meta Corporation (formerly Vintage Engineering Public Company Ltd.) for a solar project in Myanmar.

Ownership changeover in the company is also anticipated given the ongoing sell down of the firm’s major shareholdings to MAP 2000 Development Corporation (M2DC), a real estate company affiliated with the Villavincencio group.

M2DC will be acquiring 67-percent of Basic Energy’s outstanding capital stock – comprising of 9,827,990,853 primary shares for a transaction that has been pegged between P2.5 billion to P5.0 billion.

In the company’s disclosure to the local bourse in December, the De Venecia firm indicated that the equity sale will still be subject to the approval of the Securities and Exchange Commission.

In January this year, Basic Energy similarly firmed up a deal with Meta on the latter’s subscription of 180,384,497 shares and this is a transaction due for payment and closing by April this year. (MMV)