First Gen earmarks $550-M capex this year

Published May 18, 2022, 2:29 PM

by Myrna M. Velasco

Lopez-led First Gen Corporation has earmarked $550-million capital expenditure (capex) to bankroll its ongoing projects, with the bulk going into into expansion ventures of subsidiary Energy Development Corporation.

During the company’s annual stockholders meeting, Emmanuel P. Singson, chief finance officer of First Gen, told reporters that bulk of the firm’s capital spending this year will be for the completion of its interim offshore liquefied natural gas (LNG) import facility, as well as for the 120-megawatt Aya pumped storage hydro power project in Nueva Ecija.

By 2023, Singson indicated that capex will be slashed to $260 million. It will be used for the continued project developments of EDC as well as the Aya hydropower project, which will be needing higher capex of $90 million.

For this year, Singson noted the capex requirement of subsidiary EDC had been pegged at $266 million, “mainly to fund its growth initiatives, drilling programs and (facility) upgrades.”

Singson specified that 50 percent of the capex is allocated to EDC’s growth projects, specifically the 3.6MW Mindanao-3, the 29 MW Palayan Bayan and 20-MW Tanawon geothermal plants; energy storage; low enthalpy geothermal, silica extraction; and wind energy projects.

On the company’s drilling program for geothermal, it was pointed out that the scheduled spending of EDC will hover at $141 million this year.

For the LNG terminal of First Gen that is due for commercial commissioning by fourth quarter this year, Singson conveyed that capex allotment stands at $135 million – to be funneled primarily for the completion of the facility’s construction.

The Aya hydropower project, on the other, will command investment of $70 million this year; while another $50 million will be channeled to pre-development work on the propounded 1,200MW Santa Maria gas-fired power facility expansion in Batangas.

First Gen President and COO Francis Giles B. Puno said the Aya hydro project is envisioned to be the country’s “pioneering variable speed pumped-storage facility,” and will serve as an expansion of the existing 132MW Pantabangan-Masiway hydropower facility.

“We expect to start construction of the Aya project by the end of this year and hopefully be online by 2025, subject to our receipt of all required permits,” Puno stated.

Apart from the Aya venture, First Gen is in parallel targeting to advance the implementation of other hydropower developments – including the 32MW Bubunawan; 33MW Tagoloan; and 30MW Puyo projects which are being aligned as candidate-generating assets to join the government-underpinned green energy auction program (GEAP).

Puno expounded that the Santa Maria gas-fired power plant is eyed for completion in 2025; and this could be strategically positioned as one of the anchor market of the company’s LNG import facility.

“The estimated construction period for Santa Maria is 28 months. To date, we have already prepared the site and completed significant pre-development activities as well as secured key permits for the project. If needed to suit off-taker requirements, the project construction can even be faster. I think it’s a good project for us to pursue given the right circumstances,” he said.