XFN-Asia
STATE-OWNED National Power Corp. (Napocor) said Wednesday it expected to finally break even this year, after losses going back to 1998, as it cuts costs and looks to higher revenue in the wake of tariff hikes.
The power producer registered a net loss of 29.9 billion pesos in 2004, a significant improvement from the previous year's 117.02 billion loss.
Napocor was earlier this year allowed to raise its electricity tariff by an average 0.0556 peso per kilowatt-hour.
That followed a rate hike of 0.98 peso per kWh approved by the Energy Regulatory Commission in September last year.
In a statement, Napocor said it expects its interest expenses to decline to 22.64 billion pesos this year from 30.25 billion pesos in 2004, after the national government early this year absorbed about 200 billion pesos out of Napocor's total debts of 500 billion pesos.
Napocor said it also expects to reduce its operating expenses due to stringent cost-cutting measures implemented this year.
"This includes the economic dispatch of its power plants as well as an improved generation mix that will see an increased utilization of the cheaper fuel types of hydro, geothermal and natural gas, and a reduced utilization of oil and coal, which are more expensive," it said.
The rate hikes and debt transfer were meant to attract bidders for the generation and transmission assets of Napocor.
Nieves Osorio, president of the Power Sector Assets and Liabilities Management Corp (PSALM), the state agency tasked to sell Napocor's assets, said Napocor planned to borrow 200-400 million dollars in the second half of the year, possibly through a bond issue in the international market.
She declined to give details. With INQ7.net
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