EDC to pursue South Am expansion
MANILA, Philippines - Lopez-led Energy Development Corp. (EDC) will pursue its overseas expansion program in South American countries Peru and Chile with a Canadian partner, a top executive said.
“In Chile we plan to drill one to two wells,” EDC president and chief operating officer Richard Tantoco said in a text message.
“In Peru, we will do reconnaissance surveys, geophysics, geology and geochemistry work,” he added.
Early this week, EDC signed an agreement with Canada-based Alterra Power Corp. Under the deal, the companies will conduct exploration field works and due diligence at Alterra’s geothermal concessions in Chile and five geothermal projects in Peru.
The investment has no upfront cost or premium, Tantoco said. EDC will secure a 70-percent stake in the joint venture.
During the partnership, EDC will have the exclusive right to conduct exploration and due diligence.
It also holds the option to pursue the projects in a joint venture stage, EDC said.
“Under the structure we agreed, EDC will first conduct due diligence and if we are satisfied, we will invest equity,” Tantoco said.
“This agreement does not have a material effect in EDC’s existing operations and financial condition as it is merely in the preliminary stage for evaluation only,” the company said in a disclosure.
In February, EDC and Hot Rock Ltd. of Australia signed an agreement to acquire four geothermal projects in Chile (Calerias and Longavi) and Peru (Quellaapacheta and Chocopata).
However, the partners dropped the Calerias and Longavi projects in Chile in July and the Chocopata project in Peru early this month after finding out that the projects are not commercially viable.
To date, EDC has four pending applications for geothermal concessions in Chile, where EDC has set up a local office to facilitate its expansion.
EDC is the world’s second largest integrated producer of geothermal power. It is into the exploration, development and optimization of geothermal fields, as well as the operation and maintenance of the geothermal power plants with an aggregate capacity of 1,130 megawatts (MW).
Aside from geothermal projects, the company also owns and operates the 132-MW Pantabangan-Masiway hydroelectric plants and has investments in wind energy projects in Ilocos Norte and other provinces.