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Infrastructure & PPPs in Philippines - Q3 2021 Update

PHILIPPINES has seen progress in multiple PPP projects across infrastructure sectors like renewable energy, transport, social and urban infra; with higher interest and participation from international players.

Read more about key developments in Infrastructure and PPPs in Q3 2021 in Philippines in our latest insight.

 

July 2021

PHILIPPINES HEALTHCARE PPP TO LAUNCH IN APRIL 2022

The Philippines is set to launch a healthcare PPP project in April 2022. The agency will choose a transaction advisor for the Mariveles Wellness Center PPP. The feasibility study is scheduled to be completed in mid-December 2021

The project will be awarded in December 2022. The project involves the construction, operation, and maintenance of a mental wellness center in the Mariveles Mental Health and General Hospital in Bataan province. The facility will provide therapeutic and complementary services as well as alternative medicine treatments.


WPD TO DEVELOP 76 MW WIND FARM IN PHILIPPINES

German renewables developer WPD has decided to add a 75.6 MW onshore wind farm to its pipeline in the Philippines. The Bremen-based company plans to partner with Triconti ECC Renewables Corporation - a German-Swiss-Philippines joint venture - to invest in the Aklan project. Triconti will be involved in project planning and implementation. The target commissioning date is the end of 2023.

The project will benefit from a large-scale grid reinforcement and expansion programme for the islands of Cebu, Negros, and Panay. It will be connected to the grid via a new substation, which is being built by WPD and Triconti for the National Grid Corporation of the Philippines.


August 2021

DMCI UNIT PLANS OFF-GRID POWER PLANTS IN PHILIPPINES

The power division of Philippines conglomerate DMCI Holdings is planning to develop two electricity plants with a combined value of PHP 3.5Bn (USD 70Mn). DMCI Power Corporation will invest PHP 2.7Bn in a thermal power plant project on Palawan Island. The facility will have 15 MW capacity and is slated to become operational in the second quarter of 2023.

DMCI Power will also build a 12 MW hybrid diesel-solar plant on Masbate Island. The project will cost PHP 800m and is scheduled to start commercial operations in the first quarter of 2020. The thermal plant will help lower the cost of electricity on Palawan Island.

DMCI Power projects hold long-term supply agreements with grid operators Palawan Electric Cooperative and Masbate Electric Cooperative. Once the projects are completed, DMCI Power will have total capacity of 164 MW.


CITICORE PLANS TO DEVELOP LUZON SOLAR PROJECTS IN 2022

Philippines renewable energy developer Citicore Power plans to build two to three solar farms in 2022 with a total capacity of 200 MW.

The projects will be located on the island of Luzon, although the specific sites have not been decided yet. Citicore plans to raise PHP 10Bn (USD 200Mn) through the listing of a renewables-focused real estate investment trust (REIT). The proceeds will be used to finance new projects as the company aims to expand its renewables portfolio to 1.5 GW from its current 163 MW of operational capacity.


ABOITIZ FLAGS USD 3.8BN PUSH INTO RENEWABLES

Philippines conglomerate Aboitiz will push their investment into renewables, it will spend PHP 190Bn (USD 3.8Bn) in the current decade to boost capacity by more than 400%. Unit Aboitiz Power Corporation, which currently generates 900 MW of renewable energy, aims to add 3.7 GW in the period through 2030. This will make up about half of its 9.2 GW capacity target, compared with 3.5 GW at the end of 2020.

Aboitiz Power has identified 2.4 GW of renewables projects in different stages of development and located primarily in the Philippines’ main island of Luzon. Up to 60% is solar power, 32% wind and 9% hydropower.


September 2021

JERA BUYS STAKE IN PHILIPPINES' ABOITIZPOWER

Japan's JERA has agreed to buy a 27% stake in the Philippines' AboitizPower from conglomerate Aboitiz Equity Ventures (AEV) and its family-owned parent. Manila-listed AEV will sell JERA a 25.01% stake in Aboitiz Power Corporation for USD 1.5Bn in cash while the Aboitiz family’s privately held parent company will sell an additional 1.99% stake.

Following the deal, AEV will own 52% of AboitizPower, the proceeds from the sale will be used to fund the growth of AEV.

JERA and AboitizPower plan to collaborate on the joint development of liquefied natural gas (LNG) power projects in the Philippines; the operation and maintenance of the plants; fuel sourcing and management; and exploring new technologies for the power sector.

AboitizPower, one of the largest power producers in the Philippines with a capacity of 3.8 GW, owns a portfolio of hydroelectric, geothermal, thermal power plants and solar power generation facilities. The company also owns distribution utilities in Luzon, Visayas, and Mindanao, including the second and third largest private utilities in the country.


SAN MIGUEL MOVES AHEAD WITH WATER EXPANSION PROJECT

Philippines conglomerate San Miguel Corporation is progressing with a project to expand a water supply facility in the Central Luzon region. It will start engineering design studies for the Stage 3 expansion of the Bulacan bulk water supply project. The work will be completed in January 2023.

San Miguel has signed supply agreements with seven water districts - locally owned corporations in charge of the water supply of a specific region - and is negotiating four similar pacts. The 11 districts will be served by the Stage 3 expansion.

The 32-year build-operate-transfer project was awarded to San Miguel and Korea Water Resources Corporation (K-Water) in 2016. The consortium developed the first two stages, which became operational in 2019 and currently serves 13 water districts.


MEGAWIDE LOOKING TO BUILD TRANSPORT PROJECT IN CAVITE

Manila-listed Megawide Construction Corporation has submitted an unsolicited proposal to build a PHP 1.9 Bn (USD 38Mn) bus rapid transit system in Cavite province and intends to begin construction in the final quarter of 2022.

It has partnered with local developer Maplecrest Group for the project, which will include the construction of five bus terminals. The proposal will be subject to a Swiss Challenge.

The project will involve a 22.5km route along the cities of Imus, General Trias and Tanza, and is expected to have an initial passenger traffic of approximately 15,000 to 20,000 people daily, adding that there is no public transport servicing the targeted area.


PHILIPPINES MARKET PPP TO BE LAUNCHED IN NOVEMBER 2021

The city of Iloilo, in the Philippines, is planning to launch a tender for a PHP 3.6Bn (USD 70Mn) market upgrade PPP. The city will issue invitations to bid for the project in mid-November 2021 and the winner will be announced in March 2021.

The project will involve the design, finance, and construction of two mixed-use buildings for the Central and Terminal public markets, and the operation and maintenance of their commercial spaces. Investors will recoup investment from rental fees on commercial spaces, parking fees, cargo handling fees and warehousing charges, among others.


PLDT AND MERALCO READY HYPERSCALE-FRIENDLY DATA CENTERS

Manila-listed telecom PLDT has teamed up with utility Manila Electric Company (Meralco) to provide renewable energy to its data centers. The collaboration between the two firms on power grid design and renewable energy aims to make PLDT's data centers compliant with requirements from hyperscale’s - firms providing cloud services that drive most demand for data center capacity.

Data centers high energy demand has come into focus in recent years, as the industry expanded globally. PLDT owns 10 data center sites across the country with over 9,100 server racks and the company is considering selling the assets, valued at up to USD 500Mn.


ORMOC CITY TO LAUNCH WATER SUPPLY TENDER

The Philippine city of Ormoc is preparing to launch a PHP 5.7Bn (USD 113Mn) water supply PPP. The local government will request pre-qualification bids.

The public-private partnership will involve the development of new water sources and construction, as well as supply facilities. It will include a 40-year concession period. The city will request final bids in February 2021.

Despite a slowdown in the approval of new PPPs at the national level, several Philippines municipalities are seeking private funding to improve infrastructure. The preferred bidder in the Ormoc project will recoup its investment through the collection of water revenue.

 

List of key transactions - Philippines Q3 2021


List of upcoming infrastructure projects - Philippines (as of Q3 2021)

Source: YOG INFRA analysis, Public Information

 

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