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Wednesday, July 30, 2014

Meralco mulls conversion of Atimonan natural gas project to coal

Meralco PowerGen Corp is mulling the conversion of the company's liquefied natural gas project in Quezon to a coal-fired power facility.

Angelito U. Lantin, Meralco PowerGen Corp senior vice president and general manager, told that the company is now undertaking studies for the construction of a coal plant instead of a 1,500-megawatt (MW) LNG-fired facility in partnership with Japanese firm Chubu Electric Power Corp.

The latter said that the decision was brought about by the lack of government policy support for the nascent LNG industry.

"We are studying the site for a coal plant now. Kasi yung LNG as we have explained before --power produced from an LNG plant is more expensive than from coal. So we need the government's policy [or] if the government will support, for example, a higher price for LNG as an option to coal," he said.

Government has been trumpeting the development of the LNG industry to help secure the country's future power needs and electricity rates, especially with the Malampaya natural gas field in offshore Palawan projected to be depleted by 2024.

However, Energy Secretary Carlos Jericho L. Petilla earlier said that while LNG is less costly than coal in other markets, it is still more expensive to bring into the country because of logistics costs.

LNG prices in the international market have also been on an upswing due to growing demand worldwide and a recent US policy aimed at cutting carbon emissions from coal plants.

To ensure that the industry will take off, the government and the World Bank are currently laying down a natural gas master plan that will outline the needed regulatory and policy framework.

Phases 1 and 2 of the plan will be on the establishment of an investment and transactional framework, which the DOE and its advisers are nearing completion of. The phase 3 will involve the creation of a natural gas master plan for the longer term.

"Pero wala pa yun (master plan) eh, we cannot wait because the country needs more power. So we are studying it," Lantin said. "Maybe by end of the year meron na kami idea pano kami mag proceed. It depends on what the government's policy on LNG. So they're doing some studies and coming up with an LNG master plan pero hinihintay pa namin. "

The Luzon grid is projected to be short of 200 MW for the summer months next year due to regulatory and technical delays in the construction of power plants.

- Interaksyon

Thursday, July 24, 2014

Cement sales up 3.2 pct in 2Q

Second-quarter cement sales grew in the low single-digits on the strength of public works projects and private-sector construction.

Cement Manufacturers Association of the Philippines (CeMAP) president Ernesto Ordonez said member-firms sold 5.52 million metric tons in the April to June period, a 3.2 percent increase from the 5.349 million in the same 3 months of last year.

This brought the first-half figure to 10.718 million metric tons, a 6 percent increase from the 10.136 million in the same period of 2013.

Ordonez ascribed the higher demand to an increase in the budget of the Department of Public Works and Highways (DPWH), as well as to continuous private-sector construction.

Cement sale last year climbed 6 percent to 19.445 million metric tons from the 18.356 million in 2012.

- Interaksyon

Monday, July 21, 2014

PH stock market takes cue from equities rebound overseas

Local share prices edged higher on Monday as overseas markets recovered from last week's selloff resulting from the downing of a Malaysian passenger plane in Ukraine and escalating tension in the Middle East.

At the Philippine Stock Exchange, the benchmark index rose 21.81 points, or 0.32 percent, to finish at 6,874.88. The mining and oil counter jumped 1.03 percent to drive the stock market higher.

Advancers beat decliners, 90 to 85, while 47 issues were unchanged. Value turnover inched up to P5.44 billion from P5.27 billion last Friday, as 1.08 billion shares changed hands.

Most actively traded stocks were PLDT, Alliance Global, Philex Mining, BDO and SM Investments. Top gainers were Medco Holdings, I-Remit and Cebu Property Venture, while the biggest losers were Berjaya, Grand Plaza Hotel and Greenergy.

"Continued market buoyancy may be provided tracking rebounds of foreign markets following declines caused by world events," said DA Market Securities.

The brokerage however warned that the conflict between the US and Russia following the crash of a Malaysian Airlines jet and Israel's military offensive in the Gaza strip continue to cast a dark cloud over equities.

“Any hopes that the market will ride the Dow’s rising tide last Friday was tempered as investors still appeared unwilling to make commitments to equities,” said Jun Calaycay of Accord Capital Equities Corp.

Asian markets were buoyed by last Friday’s rebound in US stocks as corporate earnings led by Google overshadowed geopolitical concerns. The Dow Jones Industrial Average rallied 123.37 or 0.73 percent to 17,100.18, while the Standard & Poor's 500 Index jumped 20 .10 points or 1.03 percent to 1,978.22

“The market waits for a spark that is not seen to come until the bulk of earnings are released. This will be next month,” Calaycay said.

- Interaksyon

Philex Petroleum unit revives talks with CNOOC over joint exploration in West PH Sea

Philex Petroleum Corp has sent word that it is interested in reviving talks with China National Offshore Oil Co. Ltd. (CNOOC) over an oil and gas prospect off the West Philippine Sea.

On the sidelines of the PLDT SME Nation Future Talks forum on Friday, Philex Petroleum chairman Manuel V. Pangilinan told reporters that Forum Energy Plc has "sent feelers" to its Chinese partner for the resumption of talks for the joint exploration of Service Contract (SC) 72, saying now is the appropriate time to resume discussions.

CNOOC has yet to respond, but its reply “will be a factor as well that would determine our own plans in 2016," Pangilinan said.

"Even as a matter of courtesy, we should advise them that this is what we're planning to do and so forth," he said.

"We're at the basement of the discussion. This will take a long while," he added.

Forum Energy is "considering how to mobilize the resources needed for the appraisal wells by 2016" after the Department of Energy (DOE) granted the company early this month a one-year extension of its drilling program, or up to August 15, 2016, to complete its obligations under the second phase of SC 72.

"We can [start] but as you know, we are part of an overall, broader geopolitical situation so we have to be sensitive to them," Pangilinan said.

"Before we can agree, we have to get the respective agreement of our governments. Kasi di naman kami makakagalaw kung walang approval ng government natin. I'm sure sa kanila ganun din," he said.

Philex Petroleum is spending $60-70 million to drill 2 appraisal wells in SC 72. Pangilinan had said it may start drilling in the first quarter of 2016 since it may take about 6-12 months to prepare for it.

Forum Energy, which is 60.45 percent owned by Philex Petroleum, operates the petroleum block located in offshore Palawan.

Forum Energy had been in talks with CNOOC for a possible joint exploration of SC72 but the ongoing territorial dispute in West Philippine Sea has been a major hindrance to developing the area.

"They're a major oil firm in China that has an experience in oil exploration and drilling. They're a fully-integrated oil company so they'll bring the level of expertise we don't have ourselves. Of course, they could provide or procure the funding, looking to them for assistance in procuring and providing fund in case there's gas and in the development of the gas field we would look to them," Pangilinan said, referring to CNOOC.

Exploring for new gas fields is urgent, as the 25-year shelf life of Malampaya, the Philippines' only natural gas field of commercial scale, will last only until 2024. Malampaya supplies 40 percent of Luzon's electricity requirements through 3 power plants in Batangas.

The Sampaguita field, which is covered by SC 72 in the Recto Bank, is estimated to have gross reserves of over 11 trillion cubic feet of gas, an independent study commissioned by Forum Energy earlier showed.

The volume dwarfs the Malampaya natural gas field's reserves, which is placed at 2.7 trillion cubic feet, and could supply the Philippines' gas requirements for up to a hundred years.

- Interaksyon

Sunday, July 20, 2014

Higher same-store sales lift 2Q profit of 7Eleven Philippines

The Philippine licensee of the 7-Eleven chain of convenience stores grew its profit by a fourth in the second quarter of the year on higher same-store sales.

In a disclosure to the Philippine Stock Exchange, Philippine Seven Corp (PSC) said its net income rose to P224 million in the April to June period from P179.80 million in the same period last year.

This pushed earnings to P323.90 million in the first half of the year, up by nearly a tenth from P296.10 million in the same period in 2013.

"Management believes the company can sustain momentum moving forward to meet store expansion and profit goals. It has taken steps to protect and expand its leadership in light of increased competition, recognizing that rewards for market share are especially strong in the convenience store sector," PSC said.

Retail sales from company-owned and franchised stores jumped 21.9 percent to P5.35 billion in the three-month period from P4.39 billion in 2013. In the first semester, sales jumped 14.5 percent to P9.78 billion from P8.54 billion last year.

At end-June, the number of 7-Eleven stores climbed by a quarter to 1,121, of which 66 percent are franchise stores.

PSC is more than doubling its capital expenditures to P2 billion this year to open 300 new stores and renovate the close to 100 existing stores. The company plans to double its network to 2,000 in the next 3 to 4 years.

PSC operates the largest convenience store network in the country. It acquired from Southland Corp, now Seven Eleven Inc, of Dallas, Texas the license to operate 7-Eleven stores in the Philippines in December 1982.

- Interaksyon

Tuesday, July 15, 2014

Leisure Resorts to raise as much as P500M for acquisition of Digiwave

Leisure and Resorts World Corp (LRWC) is taking on fresh debt to fund its takeover of the biggest operator of state-run Philippine Amusement and Gaming Corp's (Pagcor) e-Games outlets.

In an interview, LRWC head of investor relations Freddie Reyes said the leisure and gaming company is in talks with 3 to 4 banks to raise P400 million to P500 million.

The proceeds of would help finance the P620-million acquisition of Digiwave Solutions Inc. LRWC expects to raise the funds within the month or early August, around the same time when the company closes the deal to buy Digiwave.

However, a disclosure to the Philippine Stock Exchange showed that Premier Horizon Alliance Corp (PHA), which owns 85 percent of Digiwave, transferred the latter's assets, including all the operating Pagcor e-Games stations, to the wholly owned unit Total Gamezone Xtreme Inc (TGXI).

Likewise, PHA and the minority shareholders of Digiwave have agreed to enter into a share purchase agreement with LRWC for the sale of 100 percent of TGXI following the completion of the due diligence.

"Closing it is not an issue," Reyes said. Aside from the bank borrowing, LRWC will also tap its existing credit lines or internally generated funds to fund the purchase of Digiwave.

The listed firm can pay the down payment and stretch out the balance over a certain period of time as Digiwave completes the turnover of the units to LRWC, Reyes said. Digiwave is required to deliver the e-Games stations to LRWC on or before the closing date to be agreed upon by both parties.

Digiwave is the market leader in operating Pagcor E-Games outlets in Metro Manila and nearby provinces.

In May, LRWC offered to acquire 100 percent of the outstanding capital stock of Digiwave, which is 85-percent owned by PHA.

LRWC's move to secure funding from the banks came on the heels of a plan to put on hold a P250-million preferred share sale early this year.

"We pushed back the sale of 250 million preferred shares because we felt that given the environment, the 8.5 percent coupon rate was a little bit high and that we could do better by going to banks directly. True enough, we're being offered better rates by the banks," Reyes said.

LRWC runs gaming operations through AB Leisure Exponent Inc -- which operates the professional bingo gaming through Bingo Bonanza Corp -- and First Cagayan Leisure and Resort Corp -- which operates and conducts internet and gaming enterprises and facilities in the Cagayan Special Economic Zone Freeport.

LRWC took over Midas Hotel in November 2012. The company also secured a stake in the government’s Entertainment City project after providing Henry Sy-led Belle Corp some P4 billion in funding for the $1.2-billion City of Dreams Manila, set to open in the fourth quarter of the year.


PH gets another upgrade, this time from The Economist Group

Following the debt rating lift from Japan's R&I, the Philippines again received a credit rating upgrade, this time from the Economist Intelligence Unit (EIU).

In a statement, the government's Investors Relations Office said the EIU, which is the research and analytics division of The Economist Group, raised the country's sovereign risk rating by a notch to BBB from BB, citing the declining ratio of the state's outstanding debt against its gross domestic product (GDP) as the latter works on improving its public debt position.

The Philippines' debt-to-GDP ratio has dropped from 54.8 percent in 2009 to 49.2 percent last year.

BBB, as EIU defines it, means that the debt issuer has a capacity and commitment to honor its debt obligations and only has a slight susceptibility to changes in economic climate.

EIU said the Philippine government's prudent practice of relying more on medium- and long-term debt issuance--weaning from short-term credit--has helped it improve its finances. It also said this "healthy fiscal picture' will give the state more room to hike its investments in infrastructure and social services.

“As a proportion of GDP, expenditure will rise gradually as the government seeks to increase social spending, particularly on vital infrastructure. This will help boost economic expansion and revenue collection,” the London-based firm said.

For the first time, the debt watcher also raised the political risk rating of the Philippines from CCC to B, mainly because of the peace accord between the government and the Muslim rebels. EIU said the Comprehensive Agreement on Bangsamoro will spur investments in Mindanao.

The upgrade in the political risk rating--which measures the potential drag of political events on a country's ability to pay its debts--indicates the stability of the political environment is no longer questionable to creditor at least for the short-term.
“The security situation in the Philippines should ease in the coming years following the signing in March of a comprehensive peace agreement between the government and the Moro Islamic Liberation Front (MILF), which in theory, puts an end to a decades-long conflict,” EIU said.

While the Philippines' public finance and political risk profile were raised, the EIU kept the country's currency risk rating at BBB, the banking sector risk rating at BB and economic structure risk rating at BB.

It cited a stable outlook on the peso, strong asset quality and capital adequacy of banks, and sustained flow of remittances that boost household consumption as reasons behind these ratings.

- Interaksyon

Wednesday, July 9, 2014

PLDT completes P600-million Bohol fiber cable project

Philippine Long Distance Telephone Co (PLDT) has completed a P600-million fiber optic cable project in Bohol that would support the Internet broadband requirements of the province.

In a statement, the country's largest telecom company said the new fiber link also strengthens the resiliency of PLDT domestic fiber optic network (DFON) by establishing a third link to the island of Mindanao via Bohol and Misamis Oriental.

“This new fiber link will boost Bohol's thriving tourism industry and enable the province to attract more business process outsourcing (BPO) companies to set up shop there," Napoleon L. Nazareno, PLDT president and chief executive said.

"Moreover, Boholanos will be able to enjoy improved Internet services at their homes, schools and offices," he added.

Rolando Pena, PLDT Technology Group head said the Bohol DFON is equipped with up to 50 gigabytes capacity to support the increasing demand for greater bandwidth in both fixed and wireless services by corporate customers.

The new fiber optic cable facilities also allow PLDT to provide fiber-to-the-home (FTTH) services and support the operations of its wireless subsidiaries Smart Communications and Sun Cellular, particularly in providing expanded HSPA and LTE coverage to their subscribers in the area, Pena said.

Pena said the Bohol fiber optic cable project will also support the information and communication technology requirements of the international airport that will be rise in Panglao Island.

Consisting of 245 kilometers of inland and submarine fiber optic cables (FOC), the Bohol fiber project connects the island in the north from Loon to Mactan in Cebu and in the south from Garcia Hernandez to Kinoguitan in Misamis Oriental.

By providing a third link to Mindanao, the Bohol fiber link project bolsters the PLDT’s network resiliency, making it less susceptible to outages from fiber cuts caused by natural disasters like earthquakes or heavy storms.

The PLDT Group’s fiber optic network is the most extensive in the country, with more than 85,000 kilometers of inland and submarine cables at end-March, more than 4 times that of the competition.

"Fiber is the foundation of all digital communications infrastructure. If you don't have enough of it, you cannot offer extensive, resilient high-speed broadband serviced," Pena said.

“We will continue to expand our Internet infrastructure to support the development efforts of different parts of the country. This will spread more equitably the benefits of the strong growth of the country's economy," Nazareno said.

PLDT closed the first quarter of this year with a net income of P9.392 billion, higher than the previous year's P9.062 billion. Revenue climbed to P42.543 billion from last year's P40.960 billion.

- Interaksyon

Monday, July 7, 2014

ICTSI terminates port contract in India

International Container Terminal Services Inc (ICTSI) has terminated its contract for the management and operation of a container terminal in India.

In a disclosure to the Philippine Stock Exchange, the Enrique Razon-led port operator said its subsidiaries ICTSI Ltd and ICTS (India) Pte Ltd and L&T Shipbuilding Ltd (LTSB) have signed a termination agreement cancelling the container port agreement for the management and operation of the Kattupalli Container Terminal (KCT) in Tamil Nadu, India.

"The marketing and regulatory management were the responsibilities of our landlord as were many of the sourcing and procurement activities. This limited our ability to add the value required to make a real impact to the terminal's success. Following careful consideration, we amicably agreed to rescind the management contract and return all un-accreted economics," ICTSI vice president for finance and treasurer Rafael J. Consing Jr. said in a text message.

LTSB is a joint venture between Larsen & Toubro Ltd (L&T) and Tamil Nadu Industrial Development Corp (TIDCO).

"The mutual decision for the contract cancellation came after lengthy discussions and thorough consideration by both ICTSI and LTSB. Both concluded that the existing contract is not beneficial to either party in its current form," ICTSI said.

"For its part, ICTSI deems the cancellation of the Kattupalli contract in keeping with the ICTSI Group’s overall strategy of moving away from contracts that isolate ICTSI from the facility’s day to day operations, including regulatory and commercial activities," the port operator said, adding that it will be reimbursed for the license fee it paid to operate the terminal.

ICTSI said the contract cancellation has no effect or influence on any of its other operations.

"The group will continue to actively search for opportunities in India," it said.

Last May, ICTSI bagged a 26-year contract to construct and operate a container terminal in Melbourne, Australia.

In April, ICTSI's wholly owned subsidiary, ICTSI (ME) JLT, signed a contract with General Company for Ports of Iraq (GCPI) to operate, develop and expand container facilities at the Port of Umm Qasr.

ICTSI last year earned $172.4 million, up from $143.2 million the previous year. It operates ports in Manila, other parts of Asia, the Americas, Europe and Africa.

- Interaksyon

PSEi hits 7,000 after global stocks reach all-time high

The Philippine Stock Exchange index on Monday rode on the momentum of last week’s rally to claw its way back above the 7,000 mark on Monday morning.

At the Philippine Stock Exchange, the benchmark index was trading at 7,012.52 as of 11:16 am, up 50.24 points or 0.72 percent.

The composite index is poised for its highest finish since closing at 7,021.95 on May 31, 2013, or near levels when former Federal Reserve chairman Ben Bernanke hinted that the central bank may unwind its massive stimulus program.

"Market action is continuously fuelled by technical momentum supported by slower-than-expected inflation and regional market strength in the US and European regions," said Gab Aguila, equity analyst at DA Market Securities.

Last week, data from the Philippine Statistics Authority showed inflation hit 4.4 percent in June, near the upper end of the Bangko Sentral ng Pilipinas (BSP) forecast of 4.1-4.5 percent. However, the June figure was slower than the 4.5 percent registered in May and market consensus of 4.6 percent.

Regional markets were also upbeat after the US economy added 288,000 new jobs in June, dragging the unemployment rate to 6.1 percent.

Both data powered the PSEi past the 6,900 mark last week.

"However, we're not out of the woods yet as the market is trading ahead of concrete second quarter earnings and government data releases to truly justify the market prices," Aguila said.

"We are also optimistic that the market will be sustained higher than the recent consolidation range when it corrects as we're now seeing first half 2014 laggards pick up some uptrending momentum," he added.

Last week, global stocks reached record high, thanks to a week of strong US economic data and promises from the European Central Bank that cheap money will be sloshing around for years. European shares were marginally in the red as the dust settled from Thursday's forecast-busting U.S. jobs data and ECB meeting, with investors taking the opportunity to lock in profits after the biggest week of gains since March.

A new three-year peak for Asian stocks overnight meant MSCI's All World share index, which tracks 45 countries, set its fourth consecutive record high, while the dollar, U.S. bond yields and growth-sensitive copper were also up for the week.

"Markets keep going up," said Daniel McCormack an equities strategist at Macquarie Capital in London. "The world is still awash with money and a lot of it is still coming into equities."

With Wall Street closed for Independence Day celebrations markets were quieter than usual but there were still pockets of movement.

Yields on lower-rated euro zone bonds continued to fall as analysts combed the details of new long-term loans the ECB has lined up for banks, and after it said on Thursday it stood ready to print money if needed. [GVD/EUR]

The ECB will give banks the opportunity to borrow up to 1 trillion euros for four years at a rate of only 0.25 percent from September in the hope they will lend some of that money to businesses and consumers.

"More liquidity in the system is a boost for bonds," said Peter Chatwell, fixed income strategist at Credit Agricole.

Portuguese bonds though, which have underperformed this week due to concerns about an investigation into holding companies of the country's largest bank, were still off the pace.

Stocks in Lisbon also took another tumble, down 1.1 percent on the day and one of only a handful of indexes in the world staring at a fourth straight week in the red.

The biggest loser of the day was Austria though.

Vienna's ATX index dropped over 3 percent as Erste bank, the third-biggest lender in eastern Europe, plunged 15 percent after warning problems in Romania and Hungary would drive it to a record loss.

Weak oil

Oil and safe-haven favourite gold were also under pressure as the unrest in Iraq and between Ukraine in Russia - supportive factors for both in recent weeks - remained in a lull.

The Iraqi army retook Saddam Hussein's home village overnight, while former Iraqi parliament speaker Osama al-Nujaifi said he would not run for another term, a move that should make it easier for the Shi'ite parties to replace Prime Minister Nuri al-Maliki with someone more widely accepted.

Russian President Vladimir Putin also called for better relations with the United States on Friday in a congratulatory message to President Barack Obama marking U.S. Independence Day.

Brent crude dipped back below $111 a barrel and was set to post its biggest weekly loss since early January. U.S. oil futures were down for a seventh straight day and heading for their longest such run since 2009. [O/R]

"Supply fears are easing somewhat, but Iraq is setting a high floor on prices," said Victor Shum, vice-president of energy consultancy IHS Energy Insight.

Landmark week

MSCI's broadest index of Asia-Pacific shares outside Japan ended up 0.2 percent, touching its highest levels since May 2011 after a weekly gain of 1.7 percent.

Japan's Nikkei stock average rose 0.6 percent to hit a 5-1/2-month high, and gained 2.3 percent for the week.

It came after U.S. employment growth smashed forecasts and unemployment fell to near a six-year low of 6.1 percent, effectively dispelling fears about the economy's health after a weather-hit start to the year.

The report helped the Dow Jones industrial average pass the 17,000 milestone and the benchmark S&P 500 rise to within 1 percent of the 2,000 level.

U.S. Treasury yields hit a two-month high, which in turn burnished the dollar's appeal. The benchmark 10-year yield ended at 2.64 percent after going as high at 2.69 percent. Treasuries weren't trading on Friday.

The dollar was though and it was at a one-week peak against a basket of rivals despite being a touch softer against the yen at 102.05 yen.

The ECB's loose talk nudged the euro lower to $1.3589 leaving traders wondering whether long-held bets on a rise in the dollar could finally start to pay out.

"It is very fair to say that nobody got the first half of the year right, but I think the second half of the year will be much more in line with what people expected," said Kerry Craig, a global markets strategist at JP Morgan Asset Management.

- Interaksyon

Wednesday, July 2, 2014

PH stock market advances after positive manufacturing data out of China, U.S.

Philippine share prices advanced on Wednesday, inspired by the overnight gains on Wall Street following positive manufacturing reports in China and the US, but were reigned in by cautiousness ahead of the release of the June inflation data.

At the Philippine Stock Exchange, the benchmark index climbed 23.99 points, or 0.35 percent, to close at 6,850.60. Except for the property sector, the other counters posted modest gains with the financials index leading the way with an increase of 0.74 percent.

Advancers narrowly beat decliners, 95 to 93, while 40 issues were unchanged. Value turnover picked up to P7.03 billion from yesterday's P5 billion, as 3.18 billion shares changed hands.

Most actively traded stocks were PLDT, Ayala Land, Ayala Corp, BDO and Alliance Global. The topt gainers were Apex A, iRipple and Manila Mining A, while the biggest losers were Bogo Medellin, Greenergy and Primex.

"Trading stayed slack throughout the day as investors groped for leads. Optimism crept back cautiously however, keeping the index in the green," said Jun Calaycay of Accord Capital Equities Corp.

“Investors may also be holding back ahead of the June inflation report due out this week,” Calaycay added.

Lending optimism to the local market was the positive performance on Wall Street and regional markets buoyed by favorable manufacturing data from the world's two biggest economies. Chinese manufacturing grew at its fastest pace this year in June, while the US factory index barely changed at 55.3 in June from 55.4 in the prior month.

Overnight, the Dow Jones Industrial came within a few points from the 17,000 level for the first time, rallying 129.47 points, or 0.8 percent, to 16,956.07. The Standard & Poor’s 500 Index climbed 0.7 percent to 1,973.32.

"Absent new leads overnight, we can expect the market to stay on an even keel driven mostly by a balance of both long-term accumulation and short-term liquidity options. Both hinges on the release of inflation data," Calaycay said.

- Interaksyon

PLDT to spend $2M for Asia-America Gateway cable upgrade

Philippine Long Distance Telephone Co (PLDT) on Wednesday announced that it is expanding its international bandwidth capacity to the US to support rising demand for high-speed broadband.

In a statement, PLDT president Napoleon Nazareno said the incremental capacity from this project will allow PLDT to support more industry requirements as well as enhance the quality of experience of customers of the PLDT Group.

“With the deployment of 100G technology in this international link, we will be able to extract more capacity out of our existing fiber cables and support the delivery of high-bandwidth services and applications. This will give our customers the benefits of a much faster and resilient global transport network,” Nazareno said.

PLDT is investing $2 million in the cable upgrade of the Asia-America Gateway (AAG) that will double the bandwidth capacity of the only trans-Pacific cable linking Southeast Asia and the Philippines to the US mainland.

PLDT was a lead investor in the build out of the AAG cable running 20,000 kilometers of high-bandwidth optical fiber linking Southeast Asia to the US for a total cost of $500 million, of which PLDT chipped in $50 million.

“Attuning to globalization and meeting world standards, we’ve readied our network not only in our domestic capacity but also in our international links to better future-proof PLDT in the foreseen surge of more intensive and bandwidth-hungry services, particularly to and from the US,” PLDT Technology Group Head Rolando Pena said.

PLDT leads the country among providers with the most number of international cables as well as landing stations. The AAG cable will be PLDT’s fourth international cable link up for upgrade to 100G technology, following the Asia Pacific Cable Network 2 (APCN2) and the Japan-US Cable system (JUCN). The Asia Submarine Cable Express (ASE) 100G upgrade is ongoing.

“We’ve always anticipated the need to constantly increase our capacity especially in serving the country’s leading industries given their demand for a resilient, low latency, and expansive data-driven network such as the BPO and outsourcing industries,” said PLDT Head of Enterprise, International and Carrier Business Eric Alberto.

PLDT was also the first network operator in the Philippines to deploy 100G in its domestic fiber optic network. When it was launched in 2012, the Philippines rose in leadership position in Asia-Pacific, among only a handful of other countries in the region to deploy 100G technology in its domestic network.

The AAG consortium consists of 19 parties providing connectivity among the Philippines, Malaysia, Singapore, Thailand, Brunei Darussalam, Vietnam, Hong Kong SAR, Guam, Hawaii and the US West Coast and seamless interconnection with other major cable systems connecting Europe, Australia, other parts of Asia and Africa and using Dense Wavelength Division Multiplexing (DWDM) technology to provide upgradeable, future-proof transmission facilities for telecommunications traffic.

By end-2014, PLDT will have an additional 15,000 kilometers of new fiber optic cable facilities with an estimated investment of over P1 billion to reach nearly 100,000 kilometers of fiber optic cables laid out to meet the surge of expected data traffic, more than 4 times than competition.

- Interaksyon