Petron Corporation’s executive committee has authorized the offer and issue of dollar-denominated senior notes worth up to $500 million to fund its 184-megawatt (MW) power plant project inside its refinery in Limay, Bataan, as well as for debt repayment.
Based on its preliminary offering circular disclosed to the Philippine Stock Exchange on Wednesday, Petron said it is “constructing new power plant facilities and structures, [which] will replace some of its old generators, increase steam production, and expand power generation capacity from 140MW to 184MW.”
“The estimated total cost of the project is approximately Php11 billion to Php12 billion. Construction of the new power plant facilities commenced in the first half of 2019 and is expected to be completed in the second half of 2022,” the document further said.
Petron added that the plant generates power and steam required by the refinery that utilizes petcoke as feedstock, which is more cost-efficient compared to fuel oil. It added that products once used as refinery fuel would be turned into high-value products.
According to Investopedia, a senior note is a type of bond precedes over other debts in case a company declares bankruptcy and is forced into liquidation.
The Bataan refinery has a crude oil distillation capacity of 180,000 barrels per day. It processes crude oil into a range of white petroleum products such as gasoline, diesel, liquefied petroleum gas, jet fuel, kerosene, and naphtha; and petrochemical feedstock like propylene.
Photo from Petron website.