Three firms eye Bakun hydro plant privatization

AT LEAST three companies have expressed interest in participating in the privatization of the 74.8-megawatt Bakun Hydroelectric Power Plant, state-run Power Sector Assets and Liabilities Management Corp. (PSALM) said.

In a statement on Thursday, PSALM said it is advancing the privatization process after holding a pre-bid conference for the auction on May 4.

The conference was attended by Emerging Power, Inc., a unit of Nickel Asia Corp.; Aboitiz Renewables, Inc., the renewable energy arm of Aboitiz Power Corp.; and FDC Utilities, Inc., a subsidiary of Filinvest Development Corp.

PSALM said the three companies had submitted letters of interest to participate in the privatization.

The Bakun Hydroelectric Power Plant in Alilem, Ilocos Sur is currently operated by Luzon Hydro Corp. of the Aboitiz group under an operations and maintenance agreement.

PSALM said ownership of the facility was transferred to the agency after the expiration of its power purchase agreement in February.

Construction of the hydropower facility began in 1997, while commercial operations started in 2000. Under a build-operate-transfer arrangement, its 70-megawatt contracted capacity was sold to National Power Corp. through a 25-year power purchase agreement that took effect in 2001.

PSALM said the deadline for bid submissions is set for Sept. 16 at 11 a.m. Only parties that submitted letters of interest and received bidding documents will be eligible to participate in the auction.

The agency said bid opening and evaluation will also begin on Sept. 16.

Separately, PSALM said it is seeking consultancy services for a third-party financial valuation of the Bakun Hydroelectric Power Plant, with an approved budget of P8 billion.

PSALM, created under the Electric Power Industry Reform Act of 2001, is mandated to privatize state-owned power assets and use the proceeds to help settle the financial obligations of National Power Corp.

The agency earlier said it reduced its financial obligations by P13.4 billion last year, bringing its remaining debt to P260.6 billion. It has adopted a 10-year plan to reduce its remaining liabilities. — Ashley Erika O. Jose