IFC considers funding Philippines’ 175-MW Ambuklao-Binga

The World Bank’s International Finance Corp. (IFC) is considering an application to help finance the privatization and refurbishment of the Philippines’ 75-MW Ambuklao and 100-MW Binga hydroelectric projects.

Philippine power producer Aboitiz Power and Norway’s Statkraft Norfund Power Invest (SN Power) won a 2007 privatization auction offering US$325 million for the Ambuklao and Binga hydropower plants in the northern Philippines’ Benguet Province. (HNN 11/28/07)

IFC said its board is expected to act in June on a proposal to provide loans totaling US$100 million to SN Aboitiz Power Benguet Inc., the venture set up to own and operate the projects. IFC said the total project cost of US$560 million includes acquisition for US$325 million and refurbishment capital expenditures of about US$170 million.

The World Bank unit said other loans are expected, from Nordic Investment Bank for US$60 million and from a consortium of Philippine banks for US$200 million. The remaining cost is expected to be financed by equity and internally generated cash flow. IFC said the project sponsors are in discussions with suppliers to finalize project costs.

Ambuklao and Binga are located 19 kilometers apart on the Agno River at Bokod and Itogon in Benguet Province of Luzon Island. Ambuklao, which has three 25-MW turbine-generators, was completed in December 1956 and has been under preservation by National Power Corp. (Napocor) since 2000. Binga, which has four 25-MW units, was commissioned in 1960.

IFC said SN Aboitz Power Benguet is expected to take possession of the hydro projects from Napocor in June. The rehabilitation is to recommission Ambuklao, which has been shut down due to silt problems, upgrade Binga, and increase the combined capacity by 50 MW in total, 30 MW for Ambuklao and 20 MW for Binga.

Ambuklao’s rehabilitation, through July 2010, is to include construction of a new intake and a new tailrace at higher elevations, installation of new electrical and mechanical equipment, erosion repairs, and repairs to gates.

Binga’s rehabilitation, through early 2013, is to include construction of a new intake similar to Ambuklao’s, improvement of spillway capacity, embankment repairs, and installation of new electrical and mechanical equipment, including generating units.

IFC, Norway Industrial, HSBC, Bank of the Philippine Islands, Banco de Oro, Philippine National Bank, China Bank, and Security Bank provided funding to SN Aboitiz Power Inc. in 2006 for privatization of the 360-MW Magat hydroelectric project for US$530 million. The Philippine government is attempting to raise up to US$5 billion by selling Napocor power plants. (HNN 4/11/08)

For information, contact SN Aboitiz Power Inc., Chief Executive Officer Emmanuel V. Rubio, 2/F Herco Center, 114 Benavidez St., Legaspi Village, Makati, Philippines; (632) 818-8066; E-mail: manny.rubio@snapgeneration.com.

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