Tribe Advisory provided strategic financial advisory services to Markham Resources Corporation (MRC) for the Lake Mainit Hydroelectric Power Project (LMHEPP), a 25MW renewable energy project located in Mindanao, Philippines. This initiative, with a total investment of over PhP 4.5 billion, addresses the increasing electricity demand in Agusan del Norte by providing a reliable, carbon-free power supply.
The project involves diverting excess water from the western shoreline of Lake Mainit, passing through a cylindrical intake structure, a waterway tunnel, and penstocks to a powerhouse located on the Bohol Sea coast. LMHEPP supplies electricity directly to Agusan del Norte Electric Cooperative, Inc. (ANECO), enhancing regional energy security and serving as a flood mitigation measure for local communities.
The project, located 55 km north of Butuan City and 40 km south of Surigao City, achieved commercial operations in March 2023 after nearly a decade of construction. J-POWER, a leading Japanese energy company, acquired a 40% stake in LMHEPP through Lake Mainit Hydro Holdings Corporation (LMHHC).
Tribe Advisory’s Role
Tribe Advisory played a pivotal role in the financial restructuring and successful completion of the Lake Mainit Hydroelectric Power Project. Engaged by MRC in mid-2020, Tribe navigated the project through significant financial and operational challenges, ultimately securing a strategic partnership with J-POWER.
Key contributions include:
- Restructuring Strategy: Developed a comprehensive restructuring plan to address funding shortfalls and optimize the capital structure.
- Stakeholder Negotiations: Facilitated negotiations between MRC, senior lenders, mezzanine debt holders, and J-POWER, culminating in a 40% equity sale to J-POWER.
- Contract Revisions: Transitioned the construction contract with Sta. Clara International Corp. (SCIC) to a fixed-price agreement, reducing interface risks and enhancing bankability.
- Capital Raising: Secured PhP 1.5 billion in additional senior debt financing and facilitated J-POWER’s entry as a co-investor, ensuring project completion.
Peter McCreanor, Group CEO, Tribe
“Our involvement in the Lake Mainit Hydroelectric Power Project demonstrates Tribe Advisory’s capability to navigate complex financial restructurings and deliver renewable energy solutions in Asia. Through strategic advisory services, we assisted Markham through the restructure and completion process and facilitated J-POWER’s entry as a partner, ensuring the project’s success and long-term viability. We congratulate our clients, Markham Resources, on reaching financial close with J-Power. We’ve enjoyed your support and exceptional commitment and perseverance to make the deal happen”
Summary
This initiative supports the Philippines’ renewable energy goals, stabilises the regional power supply, and enhances sustainability. Tribe’s expertise in financial restructuring and stakeholder engagement was instrumental in delivering a fully-funded, grid-connected project that benefits local communities and advances clean energy development.
About Tribe
Tribe Infrastructure Group is focused on realising national ambitions through innovative financing and development of critical infrastructure.
Headquartered at the Abu Dhabi and with offices in London, Riyadh, Manila and Sydney, Tribe operates as an independent and agile partner, strongly grounded in responsible value creation.
Tribe Advisory is the proprietary financial services arm of Tribe infrastructure Group. Tribe Advisory holds a Category 4 Licence and is supervised and regulated by the Financial Services Regulatory Authority at the Abu Dhabi Global Market.