What is geothermal energy?

In Greek, geo means “earth” and thermos means “heat”. Thus, geothermal energy is heat that comes from the earth.

The heat source is the magma which comes close to the earth’s surface in some places. The heat in a geothermal system can be harnessed in the form of steam or with water as medium.


What elements compose a geothermal system?

A geothermal system can be likened to a covered pot filled with water. When heated, the water in the pot will boil and produce steam. Four elements compose a geothermal system, namely:

  • A heat source which is the magma that comes close to the surface of the earth in volcanic areas;
  • A permeable underground reservoir rock which can hold or store water;
  • A solid cap rock which maintains pressure and does not allow the heat, water or steam to escape; and
  • Water, which serves as the medium for carrying heat.


What countries now use geothermal energy?

Not all the countries have geothermal energy – only those countries of volcanic origin and are located along the Circum-Pacific Ring of Fire have geothermal energy to tap. In 1904, Italy became the first country to use geothermal energy to generate power. This geothermal field at Larderello is still operating and is a favorite tourist attraction. With the onset of the oil crisis of 1973, countries, including the Philippines, resorted to utilizing indigenous sources of energy like geothermal energy.

The Philippines currently ranks # 2 in the world in terms of installed geothermal capacity while the United States ranks as # 1.


Where does the water that turns into steam come from?

Rainwater or “meteoric water” that fall on a forest or watershed often follows the roots of the trees and seeps down the cracks and fissures of the earth to the underground reservoirs.

  1. When did the Energy Development Corporation (EDC) become a publicly listed corporation?

The Energy Development Corporation (EDC) became a publicly listed corporation last December 4, 2006. At the time of its Initial Public Offering (IPO), the Company offered to the public for listing an initial 6,000,000,000 common shares at an offer price of Php 3.20.

  1. What are the major features of each type of EDC shares of stock?

EDC’s capital stock is composed of its common and perpetual preferred shares.

The Company’s authorized stock is Php 30.150 billion, divided into 30,000,000,000 common shares with a par value of Php 1.00 per share, or an aggregate par value of Php 30,000,000,000, and 15,000,000,000 preferred shares with a par value of Php 0.01 per share, or an aggregate par value of Php 150,000,000. Total issued and outstanding stock as of December 31, 2011 is Php 18.844 billion consisting of 18,750,000,000 common shares and 9,375,000,000 preferred shares.
The preferred shares have a gross dividend rate of 8.00 % p. a. of the par value and are cumulative, non-participating, and voting while the common shares are participating and voting only.

  1. Who is EDC’s majority shareholder?

On November 29, 2007, PNOC and PNOC EDC Retirement Fund sold their combined interests in EDC to Red Vulcan (a Philippine corporation). Red Vulcan was then a wholly owned subsidiary of First Gen Corporation (First Gen, a publicly listed Philippine corporation) through Prime Terracota Holdings Corporation (Prime Terracota). First Gen’s indirect interest in EDC consists of 6.0 billion common shares and 7.5 billion preferred shares. Control was then established through First Gen’s 60% indirect voting interest in EDC. Meanwhile, First Philippine Holdings Corporation (First Holdings) directly owns 66.2% of the common shares of First Gen. Accordingly, First Holdings became then the ultimate parent of the Company.

On May 12, 2009, First Gen’s indirect voting interest in Red Vulcan was reduced to 45% with the balance taken up by Lopez Inc. Retirement Fund (40%) and Quialex Realty Corporation (15%) through the issuance of preferred shares by Prime Terracota. As a result of this transaction, Prime Terracota replaced First Holdings as the ultimate parent of EDC effective May 12, 2009.

  1. What is EDC’s Dividend Policy?

The Company’s Board of Directors is authorized to declare dividends as long as the Company has unrestricted retained earnings. Holders of common shares are entitled to receive annual cash dividends of at least 30% of the prior year’s recurring net income based on the recommendation of the Board of Directors. Such recommendation will take into consideration factors such as current and prospective debt service requirements and loan covenants, the implementation of business plans, operating expenses, budgets, funding for new investments, appropriate reserves and working capital, among other.

Moreover, in the case of stock dividends, stockholders representing at least two-thirds of the Company’s outstanding capital stock must approve the stock dividend declaration

  1. Who are EDC’s external auditors?

EDC’s independent auditors are Sycip Gorres Velayo & Co., a member firm of Ernst &Young Global Limited.

  1. How do I buy and sell shares of stock of Publicly Listed Companies (PLCs)?

You may contact any licensed stock broker operating in the Philippine Stock Exchange. Among other fees, stock brokers charge a standard fee for every buy or sell transaction, usually ranging from 0.75% to 1.5%. an additional 1/2 of 1% stock transaction tax of the gross selling price is paid by the seller, based on the market value of the stocks sold. A transfer fee is also charged by a corporation or its stock transfer agent.

  1. What is my proof of ownership of a Publicly Listed Company’s shares of stock?

A stock certificate represents proof of ownership/right to ownership in a publicly listed company’s shares of stock. One’s ownership can be transferred once the corresponding stock certificate is endorsed or signed by the owner at the back thereof. Correspondingly, stock certificates should always be safeguarded. Its endorsement, by signing at the back , should be made only at the time of its sale or transfer.

  1. Are Stock Certificates always issued?

Buyers of shares who want their names to be recognized in the company’s stock transfer books should specifically request their stock brokers that stock certificates be issued under their names. Buyers who do not do so will have ownership of their shares under “street” or “scripless form” under the name of the stock broker. In the absence of a proxy, the registered owner has voting rights to the shares of stock.

  1. What is EDC’s ticker symbol and where does EDC’s common stock trade?

The ticker symbol for EDC’s common stock is EDC. EDC’s common shares trade on the Philippine Stock Exchange under the symbol “EDC”.

  1. Where can I buy the EDC stock? Can I buy directly from the Company?

The EDC stock can be traded (buy and sell) only in the Philippine Stock Exchange (PSE) through the PSE stock brokers. You have to open an account with any of the PSE’s active trading participants to be able to trade. A list of the active trading participants (stock brokers) together with their contact details is posted in the PSE website www.pse.com.ph.

  1. Who is EDC’s Stock Transfer Agent?

EDC’s stock transfer agent is Securities Transfer Services, Inc. (STSI). You can contact them through
e-mail address stsi@fphc.com. Registered stockholders may contact STSI regarding address changes, missing stock certificates, and other account information.

  1. What is EDC’s fiscal year?

EDC’s fiscal year is January 1- December 31.

  1. When is the next annual meeting of shareholders?

The time and location of EDC’s 2013 Annual Shareholders Meeting on May 7, 2013 at 10:00AM at the Rockwell Tent, Rockwell Drive, corner Estrella Street, Rockwell Center, Makati City. The record date for the meeting is on March 8, 2013.

  1. How can I get a copy of EDC’s most recent SEC Structured and Unstructured reports?

You may access and download our SEC filings on the Disclosures page of the Investor Relations section of our website.

  1. I am a registered shareholder who has recently moved my residence, How can I update my address?

As a registered owner of EDC shares of stock, you are listed as a shareholders in the company’s stock transfer books. For you to continually received shareholder related correspondence, you will have to send a signed letter stating both their previous and current addresses together with two (2) valid and current government issued identification cards. Our stock and transfer agent, Securities Transfer Services, Inc., will send a letter informing the stockholder if the change in address has been effected or whether additional requirements are needed.