Listed geothermal giant Energy Development Corp. (EDC) of the Lopez group assumed full operations of the 112.5-megawatt (MW) Tongonan and 192.5 MW Palinpinon geothermal power plants last Friday.

EDC took over the Palinpinon-Tongonan geothermal complex after it paid the Power Sector Assets and Liabilities Management Corp. (PSALM), the state agency tasked to liquidate the state’s power assets, P3.9 billion, which represents 40% of the purchase price. EDC has also paid $7 million for other obligations related to the purchase which involves "purchase orders, rental, option price, performance security deposit on land lease, industrial all-risks insurance policy and comprehensive general liability."

EDC will tap PSALM’s staple financing scheme for the remaining balance which allows for deferred payments of up to seven years in 14 equal semi-annual installments.

"The turnover of the Tongonan and Palinpinon power plants fully integrates the value chain of EDC’s geothermal assets from steam production to power generation," Paul A. Aquino, EDC vice-chairman, president and chief executive officer, said.

Green Core Geothermal, Inc., EDC’s special purpose vehicle for the acquisition, acquired the two plants located in Leyte and Negros Oriental in an auction conducted by PSALM last Sept. 2. Green Core then submitted the highest bid of $220 million for the power asset. The company is a subsidiary of First Luzon Geothermal Energy Corp., which is wholly owned by EDC.

"The acquisition of [National Power Corp.’s] geothermal power plants is one of our major platforms for future growth. We have set our target and achieved it," Mr. Aquino added.

EDC said the acquisition of the Palinpinon-Tongonan geothermal facilities would increase its porfolio of geothermal power generation assets to 1,049 MW.

In Leyte, EDC operates the Unified Leyte plants consisting of the 125-MW Upper Mahiao, 232.5-MW Malitbog, 180-MW Mahanagdong and 51-MW Optimization plants. In Mindanao, EDC runs the 106 MW Mindanao 1 and 2 plants. EDC’s first fully-owned power plant is the 49-MW Northern Negros geothermal plant in Negros Occidental. In addition, EDC acquired 60% equity in First Gen Hydro which operates the 100-MW Pantabangan and 12-MWs Masiway hydroelectric plants in Nueva Ecija.

Before being publicly listed, EDC was a wholly owned subsidiary of the state-owned Philippine National Oil Co.

EDC became a unit of Lopez-owned Red Vulcan Holdings Corp. two years ago after parent First Gen Holdings Corp. bought a majority in the geothermal firm for P58.5 billion.

abs-cbnNEWS.com is the online news arm of ABS-CBN Broadcasting Corp. ABS-CBN and Energy Development Corp (EDC) are both part of the Lopez Group of companies.