KEPCO: Several firms keen on coal power assets in PHL

BY LENIE LECTURA – JANUARY 19, 2023
from Business Mirror

Korea Electric Power Corp. (KEPCO) said Monday it is selling its coal power assets in the Philippines as it moves to restructure its overseas business.

The South Korean state-owned power firm said it is in the second round of the sale process of its two non-core energy assets in Cebu.

KEPCO is selling its 60-percent stake in a thermal power plant in Cebu, KEPCO SPC Power Corp. (KSPC), and its 40-percent stake in SPC Power Corp. (SPC). It has appointed Samil PwC as its financial advisor for the sale.

There are several domestic and foreign bidders that expressed “high interest” in the assets and subsequently submitted preliminary bids. Shortlisted bidders, who are invited to the second round, are expected to submit final offers by the first quarter this year. The company declined to identify them.

“KEPCO intends to enter into an agreement within the first half of this year. The shortlisted bidders are currently undergoing due diligence and site visits. As the marketing process drew more than the expected interests, the potential sale process has gained further traction towards a successful closing,” the company said in a statement.

KEPCO’s Cebu plant’s Circulating Fluidized Bed Combustion (CFBC) technology, regarded as the environmentally optimized combustion process among coal-fired power plants, is considered as the key factor for the interest from the investors’ perspective. Despite the worldwide environmental, social and governance (ESG) movement, KEPCO said electricity demands and reliance on coal, as power source, allowed for competitive bids.

KSPC, a joint venture between KEPCO Philippines Holdings Inc. (KPHI) and SPC, owns and  operates a 200MW circulating fluidized bed (CFB) coal-fired power plant in Naga, Cebu. Since its operation in 2011, the plant has been supplying stable and efficient power to the Visayas region. Additionally, KPHI also directly owns a 37.96 percent stake in SPC.

It, however, clarified that it will retain its solar power investment in the Philippines. The company has existing investment in Solar Philippines Calatagan Corp. and is looking to invest more in renewable energy projects in the country.