State-run Philippine National Oil Company-Energy Development Corporation (PNOC-EDC) is hammering out deal for a US$ 50-million loan it is seeking from the International Finance Corporation, the private sector arm of the World Bank group.

Officials of the company emphasized the cash infusion will be for the build-up of its capital expenditure (capex) for future projects.

“IFC is planning to provide financial support to the company to assist them in their medium-term capital expenditure program,” the lending firm noted.

Part of project funding will be earmarked for acquisition of a new drilling rig and the rehabilitation of existing ones.

It is also high in the state-run company’s agenda to expand its geothermal energy development - a sector where it is now taking reign.

“The proposed IFC investment will be up to $ 50 million,” the IFC said. No details were given on the tenor and interest rate set for the loan.

The IFC loan transaction is seen to bump up the expected proceeds of 0 million from the company’s initial public offering (IPO) next month.

IFC is hoping the loan will trigger positive development impact on the company’s future projects “by increasing the availability of additional resources” for upcoming ventures.

The expectation is that the additional cash raised will be aligned to pursue new energy projects which will enhance the Philippines’ capacity to be self-sufficient in terms of its access to energy resources.

The thrust of PNOC-EDC on indigenous and renewable energy development programs trails along the lines of policy programs underpinned by the IFC.

The IFC stressed its role in this investment “will be to work with the company on enhancing its corporate governance, and environmental and social risk management.”

PNOC-EDC stands currently as the country’s largest geothermal energy producer, with aggregate portfolio of 1,494 megawatts including the 150-megawatt Bacon-Manito geothermal field; 700MW Leyte; 192-MW Southern Negros and 106-MW Mindanao geothermal production fields.

In the 90’s, the company entered into various buildoperate-transfer (BOT) contracts for the production of electricity in assets that would be eventually turned over under its charge. (MMV)

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