"Though we are having some cash flow problems, we are still optimistic that this year will be good for the company," EDC chairman and president Sergio Apostol said, adding that as early as the first half, EDC had already met its original income target of P800 million.
"We have already recorded gross earnings of P800 million in the first semester of 2002. We are hopeful that we will be surpassing our original income projection of P800 million due to expected higher steam and power sales this year. So, we have to revise our income target for 2002 to P1 billion," he said.
He noted that the company’s profit for the first six months of 2002 was significantly higher than the P600 million posted in the same period in 2001.
A portion of EDC’s income goes to the National Government for payments of taxes and royalties.
EDC’s present financial difficulty is the result of its dispute with California Energy International Services Inc. (Cal Energy) for an alleged undelivered required steam by the state-owned firm.
While in the middle of an arbitration process, EDC apparently has been paying Cal Energy about $20 million a month for the alleged non-delivery of required steam. "We have submitted our memo to the arbitrators. We hope that decision which will come out before the end of this month will be favorable to EDC," Apostol said.
EDC, one of the most profitable subsidiaries of state-run Philippine National Oil Co. (PNOC), started operating the first 112.5-megawatt (MW) geothermal unit in 1984 in Tongonan, Leyte.
Earlier this week, Apostol announced EDC’s plans to diversify its operations to engage in developing hydro power and natural gas.