By Lenie Lectura - February 12, 2017
The Power Sector Assets and Liabilities Management Corp. (PSALM) said it has paid off P84.86 billion worth of debts, bringing down the state firm’s obligations to P506.34 billion.
“Payments made in 2016 amounted to P84.86 billion, consisting of financial obligations of P65.10 billion and the interest payment in the amount of P19.76 billion,” PSALM Officer in Charge Lourdes Alzona told the BusinessMirror.
The debt payment last year was higher than the P78.751 billion in 2015. Of the amount, P29.041 billion were principal debts service, including debt prepayment of P6.32 billion, while independent power producer lease obligations service reached P26.357 billion. In addition to debts service, interests on principal debt, amounting to P23.353 billion, were also paid in 2015.
Alzona said with last year’s principal payments, PSALM’s outstanding financial obligations as of end-2016 went down to P506.34 billion, or $10.17 billion. “During the year, the Philippine peso depreciated further from 47.166 to a dollar at end-2015 to 49.813 to a dollar at end-2016.”
She said PSALM, the agency tasked to manage state-owned power assets, is determined to reduce the debts of the National Power Corp. (NPC).
Under the Electric Power Industry Reform Act, PSALM is the government agency tasked to repay the debts of NPC.
“We are continuously identifying certain measures to avoid and/or minimize costs, specifically on refinancing. Among these are stringent management of collectibles, sale of real-estate assets, disposal of other assets, which entail high costs for maintenance,” Alzona added.
PSALM, she said, plans to sell some real-estate assets that could fetch an estimated P5 billion.
“The sale would be staggered, since we still have to sort out which can be sold, depending on the land title. There are areas that can be sold, such as the resort in Puerto Asul, while there are others that can’t be sold, such as the one in Bagac,” Alzona said.
This plan, she added, will be over and above the universal charge administration and other regular activities to support the liquidation of PSALM’s financial obligations.
PSALM sourced internal funds—from operations of remaining plants and collection of privatization proceeds—to pay off NPC’s debts. The remaining obligations would also be settled through privatization collection proceeds.
The power assets that have yet to be privatized include the 850-megawatt (MW) Sucat Thermal Power Plant, the 200-MW Mindanao Coal-Fired Thermal Power, the 982-MW Agus-Pulangi hydropower complex, Malaya thermal power plant, the 40-MW “security capacity” of the Unified Leyte Geothermal Power Plant (ULGPP) and the bulk capacity of the ULGPP itself.
Alzona said PSALM is in constant consultation with the Department of Finance (DOF) and the Department of Energy on policy directions. The DOF chief serves as the PSALM’s chairman of the board.