Thursday, December 14, 2017

PSALM issues default notice to Filinvest power unit

By Louise Maureen Simeon (The Philippine Star) | Updated December 14, 2017 - 12:00am
http://www.philstar.com/business/2017/12/14/1768108/psalm-issues-default-notice-filinvest-power-unit

MANILA, Philippines — State-run Power Sector Assets and Liabilities Management Corp. (PSALM) has issued a notice of default to the power unit of the Gotianun-led Filinvest Group in relation to its independent power producer administrator (IPPA) contract.

PSALM issued the notice of default to FDC Misamis Power Corp. as a serious consequence of unilaterally rescinding the IPPA agreement for the energy capacity of two Mindanao geothermal power plants.

“PSALM had no other recourse but to invoke ‘administrator default’ on the part of FDC Misamis Power Corp., the assigned administrator,” the agency said.

Likewise, PSALM forfeited the performance bond of FDC Misamis amounting to P400 million issued by East West Banking Corp.

“FDC’s decision to rescind came amidst efforts of resolving its outstanding financial obligations to PSALM comprised of generation charges,” it said.

“FDC is in arrears amounting to P405 million (inclusive of interest) as of Nov. 30, the computation of which was stringently and merely based on the provisions of the agreement,” PSALM added.

FDC Misamis was declared the winning bidder in the IPPA bidding undertaken by PSALM with a P128-million offer.

The Mt. Apo 1 and Mt. Apo 2 geothermal plants, each with a rated capacity of 54.24 megawatts, are located in Kidapawan City, North Cotabato.

Owned and operated by Energy Development Corp., the power plants were commissioned in February 1997 (Mt. Apo 1) and June 1999 (Mt. Apo 2) under a build-operate own contract scheme.

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