EDC 2014 SR (UPDATED)

EDC 2014 Performance Report
Sorsogon/Albay, (4) GSC No. 04 - Mt. Apo, North Cotabato, and (5) GSC No. 06 - Northern
Negros. With the receipt of the certificates of provisional registration as geothermal RE
Developer, the fiscal incentives of the RE Law were availed of by the Parent Company retroactive
from the effective date of such law on January 30, 2009. Fiscal incentives include, among others,
change in the applicable corporate tax rate from 30% to 10% for RE-registered activities.
On October 23, 2009, the Parent Company received from DOE the Certificate of Registration as
the RE Developer for the following geothermal projects:
a.
b.
c.
d.
e.
Tongonan Geothermal Project, Under DOE Certificate of Registration No.
GRESC 2009-10-001
Southern Negros Geothermal Project, Under DOE Certificate of Registration No.
GRESC 2009-10-002
Bacon-Manito Geothermal Project, Under DOE Certificate of Registration No.
GRESC 2009-10-003
Mt. Apo Geothermal Project, Under DOE Certificate of Registration No.
GRESC 2009-10-004
Northern Negros Geothermal Project, Under DOE Certificate of Registration No.
GRESC 2009-10-005
On February 19, 2010, the Parent Company’s GSC in Mt. Labo in Camarines Norte and Sur was
converted to GRESC 2010-02-020.
On March 24, 2010, the DOE issued to the Parent Company a new GRESC for Mainit Geothermal
Project under DOE Certificate of Registration No. GRESC 2010-03-021.
The remaining service contract of the Parent Company covered by P.D. 1442 as of
December 31, 2013 is the Mt. Cabalian in Southern Leyte with a term of 25 years from the
effective date of the contract on January 31, 1997 and for an additional period of 25 years if the
Parent Company has not been in default in its obligations under the GSC. As discussed in Note 3,
evaluation and exploration assets related to Cabalian project were impaired in 2013.
In 2014, after thorough assessment, EDC surrendered to the Department of Energy the Geothermal
Service Contract covering the Southern Leyte Geothermal Project located in Cabalian, Southern
Leyte. EDC has found the project not viable considering the size of the resource and the risk
associated with the development and sustainability thereof. The Company written off the
allowance recognized for Cabalian project amounting to ₱574.8 million.
The Company also holds geothermal resource service contracts for the following prospect areas:
(i) Ampiro Geothermal Project (with a five-year pre-development period expiring in 2017,
25-year contract period expiring in 2037)
(ii) Mandalagan Geothermal Project (with a five-year pre-development period expiring in 2017,
25-year contract period expiring in 2037)
(iii) Mt. Zion Geothermal Project (with a five-year pre-development period expiring in 2017,
25-year contract period expiring in 2037)
(iv) Lakewood Geothermal Project (with a five-year pre-development period expiring in 2017,
25-year contract period expiring in 2037)
(v) Balingasag Geothermal Project (with a five-year pre-development period expiring in 2017,
25-year contract period expiring in 2037)
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