MANILA - Diversifying Philippine brewer San Miguel Corp. (SMC) said Thursday it will invest about $2 billion in the energy sector but will put on hold a controversial billion-dollar dam project.

SMC said new investments would include $350 million for the conversion of a recently acquired 620-megawatt combined-cycle power plant in Manila Bay into one that runs on compressed natural gas.

Earlier this week, the company announced net profit for the 3 months to June rose six-fold on-year to P56.3 billion ($1.1 billion) mainly on sales of assets to fund diversification efforts, including a move into heavy industries.

In the past year the group has taken a significant stake in top power retailer Manila Electric Co., oil refiner Petron Corp. and is undertaking a joint venture with Qatar Telecom.

It has also taken a 35% stake in a major north Philippines toll road project.

Meanwhile, the company told the Philippine Stock Exchange it has "deferred the execution of any agreements relating to the Laiban dam project" with the government.

SMC had made an unsolicited proposal to build the dam to harness a river east of Manila for future tap water supply to the city's 12 million people.

The proposal has run into criticism on environmental grounds and because it would skip a public tender process.

SMC said it would wait until the government's Metropolitan Waterworks and Sewerage System "has completed its review and evaluation" of the company's proposal.