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Press Releases

2000-9
June 15, 2000

Overseas Economic Cooperation Operation

JBIC Guarantees Private Placement Bonds
by Philippine National Oil Company - Energy Development Corporation
First Bond Guarantee by JBIC

  • 1. Japan Bank for International Cooperation (JBIC; Governor: Hiroshi Yasuda) signed today in Tokyo agreements on a guarantee extended for a 10-year, yen denominated privately offered bond totaling 22 billion yen, to be issued by the Philippine National Oil Company - Energy Development Corporation (PNOC-EDC) to finance geothermal projects in the Philippines. The Republic of the Philippines will guarantee the payment of principal and interest of the bond, and JBIC will guarantee the principal and the interest for the last five years. PNOC-EDC has been promoting geothermal and other non-oil energy resource development projects. The funds generated by this bond will be used by PNOC-EDC for geothermal development projects in islands of the Philippines, including Leyte and Mindanao, to improve the geothermal recycling capacity and for environmental protection.
  • 2. This guarantee is extended under the framework of the second stage of the New Miyazawa Initiative, which aims to encourage the flow of private funds to the Asian region. This is also the first guarantee of bonds provided by JBIC since the extension of guarantees to public bond offerings became a part of its international financial operations at the time of JBIC's establishment last October. The extension of this guarantee will support PNOC-EDC in procuring funds from the international capital markets, and it is also expected to facilitate the recycling of long-term private sector funds and further revitalize the Tokyo bond market. Also, since the Philippines is promoting structural reform in the power sector under the auspices of multilateral institutions and JBIC, this project is important as it supports the diversification of domestic energy use.

Outline of the JBIC-Guaranteed Bond

1. Main Features of the Bond Guaranteed by JBIC

(1)Issuing CorporationPhilippine National Oil Company - Energy Development Corporation (PNOC-EDC)
(See 3. below for a profile of PNOC-EDC)
(2)GuarantorThe Government of the Republic of the Philippines (100% guarantee of principal and interest) and JBIC (partial guarantee, See 2. below)
(3)Lead ManagersNomura Securities Co., Ltd., Bank of Tokyo Mitsubishi, Ltd., and Tokyo-Mitsubishi Securities Co., Ltd
(4)Place of IssueTokyo
(5)PurchaserQualified Institutional Investors
(6)Amount22 billion yen
(7)Use of FundsFunds necessary for PNOC-EDC's geothermal development projects to improve the geothermal heat recycling capacity and for environmental policy related issues
(8)Maturityyears
(9)Principal Redemption MethodLump sum redemption
(10)Date of SigningJune 15, 2000

2. Outline of JBIC's Guarantee

(1)Guarantee CoverageAny non-payment of principal and interest from the Philippine Government-guaranteed bond (except for the interest for the first five years)
(2)Effective Date of the GuaranteeJune 26, 2000 (scheduled)

3. Profile of the Bond Issuer

(1)Company NamePhilippine National Oil Company - Energy Development Corporation (PNOC-EDC)
(2)Date of EstablishmentMarch 1976
(3)Business OperationsDevelopment of geothermal and other non-oil energy resources
(4)CapitalPaid-up capital 10-billion peso (wholly owned by PNOC)
(PNOC is a wholly owned oil company by the Government of the Philippines)
(5)Employees3,282 (as of Dec 31, 1998)

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