The financial closing of CBK Power Corp. for a $450-million loan has been delayed due to the absence of pertinent documents, mostly government in origin.
Company officials are still awaiting developments in the right-of-way issue involving several families affected by the upgrading of the 230-megawatt (MW) power plant to a maximum generating capacity of 750 MW in the Caliraya-Botocan-Kalayaan (CBK) hydroelectric complex.
Likewise, the Department of Justice (DOJ) has not issued a legal opinion being sought by the Department of Finance (DOF) regarding the necessity of the Philippine government to issue a performance or government undertaking (PU) for the CBK project under the build-rehabilitate-operate-transfer (BROT) rule.
CBK Power is a joint venture between Edison Mission Energy of the US and Impsa Asia Ltd. The latter is a subsidiary of Industrias Metalurgigas Percarmona Sociedad Anonima (IMPSA) of Argentina.
"We are still waiting for several documents which are part of the requirements of the creditors," said IMPSA Asia president Francisco Ruben Valenti.
Valenti said CBK Power has fulfilled all its documentary and financial requirements and there is "nothing more to do but wait." March 31 is the target date for the financial closing.
He said they had received commitments from five foreign creditors to work on the financial package when all the requirements have been submitted.
The creditors are ING-Barings, Societe Generale, Banque Nacional de Paris, Industrial Bank of Japan and DKB.
Last year CBK Power planned a capital outlay of $180-million for year 2000. It would be used as initial capitalization for the rehabilitation of the 230-megawatt (MW). The CBK complex has a total project cost of $450 million.
Federico E. Puno, National Power Corp. (Napocor) president, said Impsa Asia earlier rejected a bond float or commercial paper as it would undergo a longer process to procure. Instead, Puno recommended that CBK Power draw from internal sources of funds to raise the necessary amount to start work on the CBK hydroelectric complex.
"Similar to what Kepco of Korea did in the Ilijan gas-fired power project in Batangas when they raised a substantial amount from internal sources as initial capitalization to start construction of the power plant even if its financial package with several international financial institutions was not yet closed," he added.
The CBK project earlier received a BB-credit rating from Moody's Investor Service and Standard and Poor's. The development will make it easier for IMPSA to approach financial institutions for loans to finance the $450-million CBK rehab program.