By Myrna M. Velasco
The Department of Energy (DOE) is expecting up to US$4.4 billion worth of capital flowing in – plus thousands of job creation – from prospective investments of South Korean companies in the Philippines.
This is reckoned from the four targeted projects that Korean firms SK Engineering & Construction; Sy ENC Co. Ltd.; BKS Energy Industry Ltd. and SK E&S will likely be injecting into the country’s energy sector; once blueprints and agreements are firmed up. All four firms submitted letters of intent (LOIs) to the DOE during President Rodrigo Duterte’s state visit to South Korea.
SK Engineering & Construction in particular is eyeing to clinch the US$2.0-billion engineering, procurement and construction (EPC) contract of a coal-fired power project sited in Quezon province.
While the energy department has not given the specific power project, it is manifest that this is the long-delayed Atimonan coal-fired project of the power generation arm of Manila Electric Company (Meralco), since this is the only project in Quezon province that is inching close to selecting its EPC contractor.
Nevertheless, this proposed facility’s advancement into construction phase may still be hobbled due to regulatory approval delays on the power supply agreement (PSA) underwritten for its electricity generation.
Energy Secretary Alfonso G. Cusi himself is adamant on bestowing certification of energy project of national significance (EPNS) on this multi-billion US dollars power project because of his Swiss challenge precondition to its power supply deal.
For the propounded wind farm project of Sy ENC Co., the scale of investment is pegged at US$255 million; and another US$500 million will potentially be funneled for the planned solar venture of BKS Energy Industry Ltd.
Another South Korean project, of which investment proposition had been crunched to cost US$1.6 billion, will take its plunge into the development of liquefied natural gas (LNG) import terminal hub.
Essentially, it will either be competing or fusing with the league of investors that are already cornering their space in the LNG terminal investment stage – their capital spending targets of which range from US$1.0 billion to US$2.0 billion for 5.0 million tons per annum (mtpa) capacity.
Cusi noted these investments will greatly aid in the capacity build-up of the country to meet future energy needs.
He noted the economy in general is on growth trajectory, hence, the department has been expecting demand rise that will be driven mainly by the “Build, Build, Build” infrastructure development platform of the government.
The energy chief stressed “we are expecting more Korean firms to express their interest in investing in Philippine energy projects,” adding that these ventures could hopefully advance the development of “a more robust energy sector for the country, help our job generation efforts and boost our economy.”