Filipino bank BDO Capital has arranged P24bn (Philippine peso – about US$556mn) of debt financing for a coal-fired plant near Davao City.

The borrower is Therma South – a subsidiary of Aboitiz Power, also of the Philippines. BDO Capital acted as lead arranger and issue manager, while BDO Unibank, part of the same banking group, was appointed trustee and facility agent. Other lenders remain confidential, but it’s understood that the consortium comprises primarily of local banks.

The debt will account for 70% of the total project cost, with the remainder coming from equity investment.

Therma South will use the finance to construct and operate two circulating, fluidised-bed coal-fired electric power generation facilities. The combined 300MW plant is scheduled to be operational in 2015.

Despite being home to one of Southeast Asia’s most vibrant and promising economies, the Philippines is beset by power outages. The government is keen to arrest the situation and is seeking to develop a host of power projects.

The island of Mindanao, where Davao, the country’s third city, is located has been particularly beseeched by power crises over the years.

Energy secretary Carlos Petilla says that the government plans to have an additional overcapacity of 800MW generated on the island by 2017.

Along with Aboitiz ‘s 300MW plant, Alsons Consolidated Resources is to build a 200MW plant, FDC Utilities is to build a 270MW facility and San Miguel Global Holdings is to build a 600MW coal-fired plant – all on Mindandao.

Despite being previously vocal in his opposition to nuclear power, the president Benigno Aquino is also thought to be exploring the Philippines’ nuclear energy options – a trend which is being mimicked throughout Southeast Asia.

Vietnam’s government is thought to be close to securing a giant financing package from Japan’s export credit agency, JBIC, for the purchase of Japanese nuclear energy equipment.