StanChart-led consortium to co-finance Transco project

Kanematsu-JPower Systems, the Japanese consortium that won the bidding for the Leyte-Cebu interconnection project of the National Transmission Corp. (Transco), has tapped a bank consortium led by Standard Chartered to co-finance the $68.5-million project.

In a letter to Transco, Kanematsu general manager Toshio Satoh said the bank syndicate has expressed intention to provide co-financing for the project.

Transco special bids and awards committee chairman Winifredo Pangilinan confirmed that the Kanematsu group has submitted a proposal to finance the project.

"They have submitted proposed lenders for the project. This proposal will be looked at by the government soon," Pangilinan said.

Based on the approved process, the winning bidder for the Leyte-Cebu project will look for the fund to finance the project and submit the financial/loan proposal to the government. A government team composed of the Department of Finance, the National Economic Development Authority and Transco will then evaluate the financing scheme submitted by the consortium.

Transco president Alan T. Ortiz said the Transco board will affirm within this week the results of the electronic bidding for the project. "After the affirmation of the results, they could start negotiations for financing."

Transco expects the financing scheme for the project to be firmed up by the first week of October.

The Leyte-Cebu interconnection is the biggest infrastructure project to use the e-bidding system with Transco being the first public agency sector to utilize the system for the bidding of infrastructure projects.

The Leyte-Cebu component, which is set to be completed in Dec. 2004, will allow the Cebu-Negros-Panay area to utilize an additional 200 megawatts from the geothermal power plants in Leyte.

This will entail the installation of a second underwater transmission line between Leyte and Cebu and will consist of submarine cables spanning approximately 32.5 kilometers.