Aboitiz holding firm sets P60-B capex

MANILA, Philippines - Aboitiz Equity Ventures (AEV), the investment holding company of the Aboitiz Group, is setting aside a capital expenditures budget of P60 billion this year, with the biggest chunk going to power projects.

AEV’s power generation arm, AboitizPower, will get the lion’s share – P52 billion – as it remains commited, along with its partners, to increasing total capacity by over 2,000 megawatts (MW) in the next five years.

Projects in the pipeline include the 420-MW Pagbilao coal-fired power plant in Quezon which began construction late last year and the 340-MW Therma Visayas coal plant in Cebu which will break ground within the year.

Another coal project is the 300-MW plant of Therma South, which will start operations in the first half this year, and is expected to provide much needed power to the Mindanao grid.

The project’s expansion of 170 MW is also set to commence construction within the year.    

The group is also developing the 68-MW Manolo Fortich hydropower plant in Bukidnon, which is also targeted for construction within the year.

On the other hand, AboitizPower’s long-delayed 600-MW Subic coal-fired power plant, which is being developed in partnership with Meralco Power Gen (MGen), is still experiencing  delay due to ongoing legal challenges.

Moving forward, AboitizPower is also intent on expanding its renewable energy portfolio, consistent with its commitment to provide the country with the right mix of energy sources.

The plan is to explore new sources of renewable energy such as solar and geothermal.

Toward this end, AboitizPower has recently forged a partnered with American company SunEdison, to build solar power plants in the country.

Aside from Solar, the company is also eyeing to develop 200 MW in potential run-of-river power projects located across the archipelago over the next five years.

The rest of the capex budget will go to AEV’s other units.

The group’s food  unit Pilmico has allocated P2.7 billion for the year in support of efforts to build a new layer farm and expand the capacity of various facilities under its flour, feeds, and swine divisions.

Property arm AboitizLand, for its part, is spending P3.7 billion  to acquire more industrial and residential land, as it continues to expand its business outside Cebu.

AEV’s banking unit UnionBank, meanwhile, has a budget of P455 million for continued branch expansion, particularly for its subsidiary, CitySavings Bank, as the latter pursues its growth objective of further building up its market share in Luzon.

Recently, AEV has also stated its strategic objective of entering the infrastructure space.

“We foresee the private and public sectors pouring large investments into this sector over the next 10 to 15 years and we want to play a role in this trend. We are very optimistic of the gains this new core business will bring to the group, amid the huge demand for infrastructure in both the local and emerging markets across Asia”, said AEV president and CEO Erramon Aboitiz.