Chevron geothermal assets sold as company cuts spending, jobs to handle weak oil prices
By Enrico Dela Cruz
MANILA, Dec 23 (Reuters) – Philippine property to banking conglomerate Ayala Corp said on Friday two groups of companies in which its energy unit has stakes will acquire Chevron geothermal assets in Indonesia and the Philippines, earlier valued at $3 billion.
Ayala, owned by one of the Philippines’ richest clans, is looking to expand its power generation business and is aiming to boost capacity to up to 2,000 megawatts by 2020, double a previous plan. It would be its first investment in Indonesia’s power sector.
AC Energy Holdings Inc, as part of the Indonesian and Philippine groups of companies, has signed share sale and purchase agreements with the Chevron group composed of Chevron Global Energy Inc, Union Oil Company of California and their affiliates, Ayala said in a statement.
Ayala did not disclose the acquisition price but Reuters reported earlier the assets at stake were valued at about $3 billion.
Chevron is selling assets, cutting jobs globally and slashing capital spending to save cash in a bid to preserve its dividend amid weak oil prices.
In Indonesia, Chevron operates the Darajat and Salak geothermal fields in West Java, with a combined capacity of 235 MW equivalent of steam and 402 MW of electricity.
In the Philippines, Chevron owns 40 per cent of the Philippine Geothermal Production Company Inc, which operates the Tiwi and MakBan geothermal field in Southern Luzon and supplies steam to power plants with a combined capacity of around 700 MW.
AC Energy has a 19.8 per cent stake in the Indonesian consortium that also includes Star Energy Group Holdings Pte Ltd, Star Energy Geothermal Pte Ltd, and Electricity Generating Public Company Ltd. The Philippine consortium consists of AC Energy and Star Energy Group Holdings Pte Ltd.
Two other Philippine companies, Energy Development Corp and Aboitiz Power Corp, were in Chevron’s shortlist of potential buyers, along with Japanese firms including Marubeni Corp, local media reported last month.
(Reporting by Enrico dela Cruz; Editing by Manolo Serapio Jr.)