Cebu Coal-fired Power Plant

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The Cebu Power Plant is a 200MW (100MW x 2) coal-fired plant to be located near Cebu City in the Naga Municipality. In 2007, Cebu Provincial Government awarded the project to a joint venture (KSPC) between Korea Electric Power Corporation (KEPCO) and Salcon Power Corporation (SPC). The project was to be developed as an independent power producer to serve Visayas region (70%) and sell electricity into a wholesale merchant market (WESM)(30%). The Philippine Government did not provide any guarantee mechanism for the project. Korean KEPCO had a 60% stake while SPC owned 40% of the KSPC joint venture that undertook the construction, ownership, operation, management and maintenance of the project. KEPCO was an integrated electric utility company engaged in the transmission and distribution of electricity in Korea. SPC was a venture company engaged in power projects in Cebu Province and owned by members of the Salcon Consortium. The project total cost was estimated to be US$451 million. The project reached financial closure in March 2010 with a debt/equity of 60/40. Financing comprised US$70m 11-year 3 months term loan, US$100m 11-year 3 months term loan, US$100 11-year 3 months term loan and $181m in equity. The debt was arranged by Credit Agricole CIB, SMBC,ING, ADB and Kexim. ADB and Kexim each committed around US$120 million in December 2009. Construction of the plant started in February 2008. In December 2007, KSPC closed a $300-million deal with Doosan Heavy Industries & Construction Companies Ltd. to construct the plant. The power facility was to use clean coal technology that limits nitrogen and sulfur oxide emissions. The plant was to use coal from Indonesian suppliers PT Kasih Industri and PT Surya Sakti Darma Kencana and qualified local coal producers. The two 100x2MW units were to be built within the existing Naga Cebu Power Complex. Target completion date for Unit I was February 2011 and May 2011 for Unit II. FINANCIAL CLOSURE DELAYED --> Mar 2010 Should be revised and updated