Formosa Plans $1.5 Billion Investment on Power Projects in Philippines

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Researched by Industrial Info Resources (Sugar Land, Texas)--Formosa Heavy Industries Corporation (FHI) (Kaohsiung, Taiwan), a subsidiary of Formosa Plastics Corporation (TPE:1301) (Kaosiung), has announced that it is doubling its investment in the Philippines' power sector to nearly $1.5 billion. FHI, a leading machinery and equipment manufacturer for the petrochemical, plastics, and energy industries, plans to invest an additional $700 million in 2009 on two more thermal power plants. FHI has not yet disclosed the location for the two proposed power plants, and plans to hire 8,000 workers for these new projects.

The company had earlier earmarked $700 million on two coal-fired power plants to be built in Cebu and IIolio. FHI, in collaboration with Metropolitan Bank and Trust Company (PSE:MBT) (Makati City, Philippines), the largest bank in the Philippines, is constructing the two coal-fired thermal power plants at Toledo in Cebu and at Lapaz in Iloilo. There are about 12,000 workers employed at the sites of these ongoing power projects in Visayas. The plants are designed to have a combined capacity of 150 megawatts (MW). FHI has a significant presence in East Asia and operates over 14,000 MW of mostly thermal power plants in Taiwan, China and Vietnam.

Despite the global economic slowdown and decline in investments of new projects, the Philippines has received total investments of $1.14 billion in 2008, a 30% growth over last year. FHI has made a key contribution to the country's power sector, a sector that offers tremendous growth potential in the country. The Philippines is expecting FHI to invest in other sectors of the country as well in the future such as plastics, as Formosa Group operates a vast plastics and petrochemical facility in Vietnam.

Another mega project announced in 2008 was that of Taiwan Cogeneration Corporation (TCC) (TPE:8926) (Tapei, Taiwan), an engineering, procurement and construction company operating in the power cogeneration sector.TCC is building a 300-MW power plant in the Redondo Peninsula of the Subic Bay Freeport at an investment of $400 million. The $550 million Redondo power plant is a joint venture between TCC and Aboitiz Power Corporation (PSE:AP) (Cebu, Philippines). The joint venture has hired about 5,000 workers for the project, and construction is likely to start in the second quarter of 2009. The plant is expected to be operational by 2012.

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