Business World Online
Posted on May 17, 2013 07:11:02 PM
The Power Sector Assets and Liabilities Management Corp. (PSALM) will conduct an auction in July for the privatization of the 145.8megawatt (MW) Naga power plant complex in Cebu.
Interested bidders are instructed to submit a letter of intent (LOI) on or before May 27.
“Only interested parties that submit an LOI by the LOI submission deadline shall be allowed to participate further in the privatization of the asset,” the notice read.
The auction for the privatization of the power facility is set on July 24, with a pre-bid conference on June 5. Due diligence will run from May 17 to July 22.
PSALM said that a two-envelope bidding system will be adopted.
Bidders will be required to post a bid security equivalent to P98.865 million “in the form of irrevocable letter of credit.”
“The bid security of the winning bidder shall be substituted by a performance security to guarantee prompt, faithful and complete performance of its obligations under the transaction,” the notice read.
All interested parties must also pay a non-refundable participation fee of P120,000 for the bidding package, which includes the details of the privatization.
PSALM is mandated by Republic Act No. 9136, or the Electric Power Industry Reform Act of 2001, to handle the sale of the remaining power assets and financial obligations of the National Power Corp.
The Naga power facility is currently being handled by SPC Power Corp. under an extended operation and maintenance service contract which started in March 26 and will expire on Sept. 25.
PSALM initially gave SPC a three-month contract extension until Dec. 25, which was extended anew until March 25.
The Naga power plant complex consists of thermal power plants. The 50-MW and 56.8-MW thermal plants use coal with a mixture of bunker oil as fuel, while the 38- MW plant is fueled by bunker oil and diesel. -- Claire-Ann Marie C. Feliciano source
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