LISTED mining firm Benguet Corp. has secured a long-term contract with AboitizPower Corp. to supply power to its mining operations in Benguet province.
The company told the Philippine Stock Exchange on Wednesday that the 20-year agreement will be signed with AboitizPower’s subsidiary Therma Luzon Inc. Benguet Corp. has mining operations through its Acupan Contract Mining Project in Itogon, Benguet province.
“The supply agreement covers one megawatt for 20 years, which is their current demand. We are hoping that they continue to grow,” Luis Miguel Aboitiz, AboitizPower senior vice president, told reporters at the sidelines of the inauguration of the 105-MW Ambuklao hydropower plant on Wednesday.
Therma Luzon manages and trades the contracted capacity of the 700-megawatt Pagbilao coal-fired power plant in Quezon. The company became the independent power-producer administrator of the Pagbilao plant after offering the highest bid of $691 million in 2009.
Benguet said it would pursue the development of its current mining assets, including the Balatoc Tailings Project, under its subsidiary, Balatoc Gold Resources Corp., the Sta. Cruz Nickel Project and the Acupan Gold Project.
Production at the Acupan site averages 115 tons of ore per day (tpd) in the three months to June. The company earlier disclosed that production will be increased to 150 tpd this year, and to 300 tpd by the end of 2012.
Chief Financial Officer Renato Claravall said in September the company plans to ramp up production to 500 tpd.
Also in September, the board of Benguet Corp. approved a quasi-reorganization/equity restructuring plan to reverse negative retained earnings.
The company told the PSE on Wednesday that positive retained earnings would allow it to again pay dividends to shareholders.
“The proposal calls for offsetting the deficit in retained earnings of P2.2 billion with revaluation increments in land of P1.7 billion and capital surplus of P1.2 billion without affecting the par value of its shares,” the company said in its disclosure.
“The quasi-reorganization/equity restructuring is among the last steps needed to be taken by the company to complete the corporate restructuring process,” it added.
The plan will be implemented by management as soon as approval of its application with the Securities and Exchange Commission is obtained.
Benguet A shares, which are open to Filipinos, dropped 0.39 percent to P25.5 each on Wednesday’s trading while the B shares, which carry no ownership restrictions, ended unchanged at P25.30.
