Panay Power Project

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Panay Power Corp. was a joint venture between the First Philippine Holdings (50%), First Private Power Corp. (a subsidiary of First Philippine Holdings, 20%) and Panay Electric Co. (30%). Construction on the 72 MW power plant started in early 1998 and was completed in the end of 1998. Financing for the project was achieved through debt (75%) and equity (25%). Debt financing was provided under an ECA facility given by Bayerische Veriensbank AG (with a COFACE guarantee) and the FCDU facility from the Far East Bank and Trust Co. and PCIBank. Power was sold to the Panay Electricity Co. under a 25-year power purchase agreement (privately-owned company PECO held a long-term distribution franchise for the city of Iloio since 1923). In September 2003, Mirant Global Philippines Corp. broke ground on a project to expand the 72 MW diesel-fired plant it purchased from the Panay Power Corporation in June 2003. The 1bn-peso (US$18 million) project entailed adding 40MW of capacity to the existing facility at La Paz, Iloilo city. Mirant Global Philippines Corp., a 50:50 joint venture between the US's Mirant Philippines and Global Business Holdings, bought the plant for 2.32 billion pesos. Mirant was the largest independent power producer in the country, while Global Business was a subsidiary of Metrobank Group. Panay Electric was to purchase 10MW of the new capacity, while 10MW was to be offered to each of the Iloilo Electric Cooperatives 1 and 2, and the remaining 10MW of electricity to other cooperatives. In May 2006, Mirant Corporation sold its 50% holding in Mirant Global Philippines Corp. to its joint venture partner, Global Business Power Corporation. As a consequence, Metrobank Group became the 100% owner of Panay Power Corp. Financial closure for the development of a new unit of 150MW to the existing 164MW plant reached in March 2015. Construction began in mid-2014 and commercial operation was scheduled for July 2016. Borrower was Panay Energy Development Corp. Legal advisers to lenders were Castillo Laman Tan Financing comprised US$218 million(PHP9.8billion) 12-year term loan and a US$26 million(PHP1.2billion) 12-year term loan. MLA is First Metro Investment Corp. Arrangers included BPI Capital Corp, China Banking Corp, Land Bank of the Philippines, PNG Capital & Investment Corp and RCBC Capital Corp. In March 2009, it was reported that the Philippines SEC had approved the merger of Panay Power Corp and Avon River Power Holdings Corp (Project ID: 3403) to form a new company, Panay Energy Development Corp. Both Panay Power Corp and Avon River Power Holdings Corp were owned by Global Business Power Corp., a Metrobank company.