Corporate News

Expansion for Sto. Tomas geothermal facility seen

Posted on October 28, 2016

MAIBARARA GEOTHERMAL, Inc. (MGI) has at least 8 megawatts (MW) more to expand in its Sto. Tomas, Batangas geothermal energy facility after it completes the second phase of the project, possibly bringing its installed capacity in the area to about 40 MW.

“In the future, if the reservoir performs well, we can in fact drill even more wells and see whether to expand up to 40 MW,” MGI President Francisco G. Delfin, Jr. told reporters on Thursday during the groundbreaking of the 12-MW second phase of the project.

“It may not necessarily just be 8 MW. We can expand for more but subject to additional environmental permitting,” he added.

This year’s expansion comes two years after the 20-MW first phase started operating commercially in 2014. The company monitored the reservoir -- the hot water and steam underneath that becomes the source of fuel -- and decided to test for additional capacity.

“We drilled additional wells in 2014. We tested them in 2015 and these additional wells show that we have additional capacity that is sufficient for more power generation,” Mr. Delfin said.

As required by the Department of Energy (DoE), a third-party validator confirmed the potential capacity of the field at more than 30 MW for 25 years. The second phase is expected to be finished by the fourth quarter of 2017.

Mr. Delfin placed the cost of the second phase at P1.86 billion, which was funded by an P1.4-billion loan from Rizal Commercial Banking Corp. and equity from existing shareholders.

MGI, which operates the facility, is a joint venture of PetroGreen Energy Corp., Phinma Energy Corp. and PNOC Renewables Corp. with stakes of 65%, 25% and 10%, respectively. PetroGreen is a subsidiary of publicly listed PetroEnergy Resources Corp.

MGI has contracted Fuji Corp. of Japan to build and supply the turbine and generator for the second phase, which Mr. Delfin said is “currently the only active construction of a new geothermal power plant in the country.”

PetroGreen President Milagros V. Reyes said she expects MGI revenues to increase further in 2018 along with its remittances and tax payments to the project’s host local government unit.

Mr. Delfin said the additional capacity for the second phase is covered by the company’s existing service contract granted by the DoE as well as its environmental compliance certificate from the Department of Environment and Natural Resources, which approved the 40 MW applied for by MGI.

He estimated the second phase of the Maibarara project to gross roughly around P400 million annually by 2018, which will add to the P700 million revenues generated by the first phase. PetroGreen is dependent on the dividends contributed by its subsidiaries, which aside from MGI, include PetroWind Energy, Inc. and PetroSolar Corp. -- Victor V. Saulon