Agribusiness enterprises-cum geothermal energy generation in Naujan, Mindoro: A pre-feasibility analysis

A 40MW Geothermal power plant will soon rise in Naujan, Oriental Mindoro. To be managed by the Emerging Power, Inc. (EPI), it covers the political jurisdiction of three villages where 4,219 individuals or 1,021 households reside. Agriculture and fishing are the predominant sources of income of local residents with average daily per capita income of Php50. This is almost 20 percent below the poverty thresholds. Agriculture is coconut-based, intercropped predominantly with banana, and a few fruit trees (e.g. Coffee, cacao). Farming is primarily mountain eco-system and ecologically fragile, as cultivation has now encroached in areas serving sources of potable water for the communities. Sustainability of agricultural production is in jeopardy in view of the need to expand economic opportunities among residents. It is critical that new value-adding activities consistent with the resource endowments of the locality to be developed. The introduction of agri-based social enterprises could pave the way for weaving together the economic requirements of residents and environmental stability. This study provides an analysis of the feasibility of undertaking non-power applications in agriculture and fishery, of geothermal resources in Naujan, Oriental Mindoro. It identifies agribusiness enterprises that will address socio-economic demands of the communities covered by the Geothermal project, at the same time promoting agriculture sustainability. Using both secondary and primary data, it employs simple economic analysis in assessing the effects of directly using geothermal resources in the agribusiness enterprises. Based on available information there is evidence that there are substantial economic benefits from non-power application of geothermal resources in the project site. Copra drying using geothermal heat in place of the traditional "tapahan" system ensures higher product quality and more favorable farm gate prices. New value-adding activities from agro-processing using geothermal heat will enhance economic opportunities of local residents. (author)