PSE Circular for Brokers No. 3154-99

December 10, 1999 PSE CIRCULAR FOR BROKERS NO. 3154-99 December 9, 1999 THE PHILIPPINE STOCK EXCHANGE Philippine Stock Exchange Centre, Exchange Road Ortigas Center, Pasig City Attention: Disclosure Department Gentlemen: Top executives of Omico Corporation and its two Swedish strategic partners today presented to President Joseph Ejercito Estrada their joint plans for the development of the power industry, for watershed and environmental protection, and for community development in Mindanao. llcd Gerold Lange, President and CEO of Vattenfall Generation Services Hydro International AB, and Lars Brannstrom, Manager Asia Pacific of ABB Generation AB, a subsidiary of ABB Alstom Power Group, called on President Estrada on Thursday, December 9, accompanied by Roman A. Cruz, Jr., President and CEO of Omico; Antonio Lopa, a major Omico stockholder; Philip B. King, Omico Corporate Secretary; and Tommy Kin Hing Tia, Omico Chief Financial Officer. The group informed the President of the plan of their strategic alliance to engage, through Omico, in US$760 million worth of integrated projects in the Agus power system in Mindanao, subject to all requisite government approvals. The plan incorporates a power and a non-power component. Of the amount mentioned, US$400 million will construct a new plant to be known as Agus 3, while US$360 million will optimize and secure the rated capacities of Agus 1, 2, 4, 5, 6 and 7, as well as fund the implementation of the non-power component. prcd The power component aims at expanding the availability of power from an environment-friendly, renewable source of energy (hydroelectric) and at substantially reducing the cost of power in Mindanao, thus restoring the attractiveness of Mindanao as a location for industries. The non-power component includes: (a) watershed management, involving the reforestation and vegetative enhancement of the surrounding areas to arrest and reverse the degradation of the water capacity of Lake Lanao, the source of water of Agus River; (b) the irrigation of 5,000 hectares of agricultural land; (c) the provision of shelter; and (d) the generation of livelihood and employment, the preservation of the culture, and the enhancement of the quality of life of the communities living in the vicinity of the lake and river. These investments will not involve any cost to the government. They are being offered as a Build-Operate-Maintain and-Manage (BOMM) scheme under Republic Act 6957, as amended. The group proposes, in consonance with the Electric Industry Reform Bill pending in Congress, that the ownership of the Agus system being part of the national patrimony, not be privatized but remain in government hands, and that the facilities to be built and the improvements to be provided by the consortium led by Omico shall be turned over to the government after 26 years. The group also committed that all present employees shall be retained or retrained and redeployed. LibLex The equity and debt financing of the scheme would be provided principally from international financial sources and is to be raised by Vattenfall and ABB Alstom Power. The project represents a major commitment in Asia of both of these companies. llcd ABB Generation AB, as contractor, will provide the equipment and systems required, while Vattenfall will provide the management and technology for modern power operation and maintenance. President Estrada observed that the project was timely, and told the group to coordinate with the Department of Energy and with the National Power Corporation on the proposal. He expressed his desire that the construction of Agus 3 be completed within his term. He assured the group of the assistance of the Office of the President whenever needed. LexLib ABB Generation AB Sweden is a part of ABB Alstom Power, a world leader in the supply of power generation equipment and services, with a presence in more than 100 countries. Jointly owned by ABB and Alstom, ABB Alstom Power comprises eight business segments. Its product range includes turnkey plants, gas turbines, steam turbines, hydro turbines, generators, boilers, heat exchangers, control systems, environmental systems, customer service and project finance. Proforma revenues for 1998 totalled 10 billion euros. cdlex Vattenfall, Sweden, is a leading European energy company with a revenue of US$3.5 billion. Vattenfall generates 22% of the electricity in the Nordic countries. More than 9000 MW of Hydropower generation is owned and operated by Vattenfall. The company has about 8000 employees and the head office is in Stockholm, Sweden. Truly yours, (SGD.) ATTY. PHILIP B. KING Corporate Secretary