First Gas inks $544-M loan for maturing obligations

First Gas Power Corp. has signed a $544 million syndicated loan to refinance its maturing obligations.

In a disclosure to the Philippine Stock Exchange, First Gas said the term loan facility will come from nine foreign banks: The Bank of Tokyo-Mitsubishi UFJ Ltd., Calyon, KfW IPEX Bank GmbH, ING Bank N.V. Singapore Branch, Bayerische Hypo-und Vereinsbank AG Hong Kong Branch, Malayan Banking Berhad, Standard Chartered Bank, Société Générale and Kreditanstalt für Wiederaufbau.

First Gas will use the loan proceeds to repay its existing debt of $132 million.

First Gas is a wholly-owned subsidiary of First Gas Holdings Corp., which is in turn owned 60 percent by publicly-listed First Gen Corp., with the remaining 40 percent owned by BG Consolidated Holdings (Philippines), Inc.

The term loan consists of two tranches: an uncovered facility with a 10-year tenor and a political risk — covered facility with a 12.5-year tenor.

Out of the proceeds of the refinancing, First Gen will receive the amount of $215 million, which amount will be used to pay down a significant portion of First Gen’s maturing debts.

“Despite the volatility of today’s financial market, the $544-million long-term debt facility obtained by First Gas is a testimony to the lenders’ continuing confidence and commitment to our group and the projects that we undertake,” Federico R. Lopez, president and CEO of both First Gen and First Gas said.

First Gas and affiliate FGP Corp. own and operate the 1,000-megawatt Santa Rita and 500MW San Lorenzo natural gas-fired power plants, respectively. Both plants are located in Batangas City.

First Gen is the largest power generation company in the Philippines with an installed capacity of 2,582 MW. It accounts for approximately 17 percent of total installed capacity in the country today. In addition to the Santa Rita and San Lorenzo power facilities, First Gen owns, through its subsidiary Red Vulcan Holdings Corp., a controlling stake in Energy Development Corporation (EDC).

EDC is the largest supplier of geothermal energy in the Philippines and is principally responsible for the Philippines being the second largest geothermal energy producer in the world. — Donnabelle Gatdula